Melnychenko R. Administrative and Legal Fundamentals of Tax Control of Transfer Pricing in Ukraine

This thesis is the first complex scientific research of the administrative and legal fundamentals of tax control of transfer pricing in Ukraine in the national jurisprudence. This paper provides a detailed research of the essence of tax control of transfer pricing; information on the formation and development of tax control of transfer pricing in Ukraine; algorithm of work and interaction of supervisory authorities while conducting tax control of transfer pricing in Ukraine; procedures and methods of tax control of transfer pricing in Ukraine; system of state coercion measures for violation of the Tax Code of Ukraine regarding transfer pricing. The thesis focuses on the study of foreign experience in the United States and Great Britain, as well as on recommendations of the OECD and the G20 countries regarding the implementation of the BEPS Action Plan. In order to provide an objective assessment of national legislation, the author systematized valid judicial practice in Ukraine in relation to tax control of transfer pricing and outlined its key issues and further development tendencies. The author substantiates the necessity of strict state regulation of transfer pricing using administrative methods. Such a regulation lies in limiting the parties' freedom to determine the contractual price that would allow taxpayers to erode tax base and exempt profit from taxation with the help of manipulating prices. Tax control of transfer pricing is characterized by wide discretionary powers of supervisory authorities and high degree of subjectivity of supervisory authorities' employees. The author proved that assessment of transfer pricing by the supervisory tax authorities is the most subjective estimates of taxpayers' obligations of all the possible and depends exclusively on the qualifications and integrity of supervisory authorities' employees. The practical value of the paper lies in the fact that it outlines key issues of legal regulation of tax control of transfer pricing in Ukraine, which allow taxpayers to abuse their rights and evade from taxation. The topicality of the issue is also enhanced by the fact that it offers the author's opinion on further improvement of organizational fundamentals of tax control of transfer pricing in Ukraine.