Taxes, Transfer Pricing, and The Multinational Enterprise

Lorraine Eden

in The Oxford Handbook of International Business

Second edition

Published in print January 2009 | ISBN: 9780199234257
Published online September 2009 | e-ISBN: 9780191577086 | DOI:

Series: Oxford Handbooks in Business and Management C

Taxes, Transfer Pricing, and The Multinational Enterprise

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For more than ten years now, transfer pricing has been the top international taxation issue faced by multinational enterprises (MNEs). This article aims to outline, for the reader, the complex issue of transfer pricing, as seen by MNE managers and by governments faced with the daunting task of taxing business profits. The article is organized as follows. First, it briefly discusses transfer pricing from the MNE's perspective and the problems that this raises for national governments. It then reviews the basic rules of international taxation as they apply to MNE profits. The specific rules and procedures that apply to transfer pricing, as practiced in the United States and recommended by the OECD, are then outlined. It concludes with a discussion of unresolved problems that are likely to plague transfer pricing over the next few years.

Keywords: taxes; transfer pricing; multinational enterprise; business profits; MNE managers; OECD

Article.  12020 words. 

Subjects: International Business

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