By Amrit Dhillon
A circular issued by India's Central Board of Direct Taxes in New Delhi said that only international transactions worth more than 150 million rupees ($2.3 million) will come in for compulsory transfer pricing scrutiny.
Tax specialists told Bloomberg BNA that the earlier ceiling of 50 million rupees ($760,000) had already been revised to 150 million rupees in the CBDT's internal guidelines for tax officers. The circular serves to make the higher figure public and official.
The circular (No. 10/2013), dated Aug. 5, also said the higher ceiling applies to cases:
Other tax experts said the increase in the limit for a mandatory assessment on transfer pricing will provide relief to many taxpayers and reduce the costs of doing business in India.
“It's particularly good news for small and medium taxpayers as this will mitigate their exposure to stiff transfer pricing assessments,” said Amit Singhania of the law firm Amarchand Mangaldas in New Delhi.
Text of the circular is at http://www.itatonline.org/info/index.php/cbdt-criteria-for-selection-of-scrutiny-cases-in-fy-2013-14/.
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