Transfer Pricing is a Financing for Development Issue

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In this FES-New York report, the UN Assistant Secretary-General for Economic Development, Jomo Kwame Sundaram, calls attention to transfer pricing: “the pricing arrangements for transactions between companies that are members of a corporate multinational enterprise.” Explaining the otherwise highly technical phenomenon, Jomo shows how transfer pricing, or rather “mis-pricing,” is used by firms to facilitate tax evasion. A critical effect of mis-pricing can be that developing countries collect fewer taxes than they have a claim to, a source of revenue that is crucial for financing development. 

By Jomo Kwame Sundaram

Friedrich Ebert Stiftung - New York
February 2012


Click here to read the report.