UnionBudget2023 Proposals – Transfer Pricing
The Finance Minister presented the Union Budget for 2023-24. The alert captures the Transfer Pricing updates in the Finance Bill 2023 and includes:
- Reduced time to submit information called by Assessing officer during audit proceedings, hence requiring contemporaneous documentation including supporting documents for international transactions.
- New inclusion to Specified Domestic transaction (SDT)- Transactions between New manufacturing co-operative society set up and its closely connected person are subject to transfer pricing
- Limitation of interest deductions (Section 94B) – Exclusion of Non-Banking Financial Companies (NBFC) thincapitalization
- Introduction of New authority – Joint Commissioner (Appeals) – for cases when the disputed amount involved is small.
- Option to file cross objections before the Tax tribunal available to respondents for all class of orders (including DRP order)
Several industry expectations such as implementation of Pillar One / Two, updates to Advance Pricing Agreement (APA) program, transition to interquartile range did not form part of Budget 2023.