Tax enforcement follows information. The more structured the data, the easier it is to sort, compare, and flag.
Transfer pricing has always influenced where profits are booked. What has changed is the reporting volume and format. Annual filings now arrive in standardized electronic form. Systems ingest them automatically.
The development
Following the OECD Base Erosion and Profit Shifting project, countries expanded documentation requirements. Multinationals now submit combinations of master files, local files, country-by-country reports, and, in some jurisdictions, additional information returns.
More than fifty countries require the full package. Many others require at least one component. These filings disclose group structure, intercompany pricing methods, jurisdiction-level profit data, and tax paid by geography.
Historically, much of this information surfaced during audits. Now it is delivered every year in structured formats. Electronic portals capture fields that can be queried acr…
