By Theodor Artenie
According to the latest statistics, Romanian tax authorities rank transfer pricing (“TP”) high on their agenda. Companies are increasingly aware of the risks they face unless they have the TP documentation ready when asked by the tax inspectors, yet many fail to take action in due time.
In 2017, the Romanian tax authorities conducted over 41,000 tax audits, which resulted in over RON 8bln (approx. EUR 1.76bln) additional tax liabilities. Out of this amount, the additional taxable base established following TP adjustments amounted to RON 1bln, with over RON 60m representing additional corporate income tax and related ancillary liabilities due to TP adjustments, while the tax authorities decreased the available tax losses of companies with RON 316.4m. The top high-risk industries under increased scrutiny are construction and building materials, production and trade of agri-food and energy products, transport and timber processing.