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Chevron case – the wash up
Taxand Australia looks at significant recent Australian transfer pricing developments.
The long running transfer pricing dispute between Chevron Australia Holdings Pty Ltd (Chevron Australia) and the Australian Commissioner of Taxation has come to an abrupt end. Having applied for special leave for the matter to be heard by the High Court (Australia’s superior court), Chevron Australia announced on 15 August that it had reached a confidential settlement with the Commissioner and that it had accordingly lodged a notice of discontinuance in respect of its application.
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These developments in case law, the PCG and FIRB (together with the Australian Government’s current laser like focus on multi-national tax avoidance), mean that the Commissioner is focused on transfer pricing and sees it as fertile ground for compliance activity. This means that taxpayers should be reviewing their international financing arrangements and other transfer pricing practices (those already on foot and those proposed to be entered into) carefully.