- Funding Programme
- Structural Reform Support Programme (SRSP)
Transfer pricing capacity building and management based on best practices
The Commission supports the strengthening of the administrative capacity of the Ministry of Finance and National Tax and Customs Administration of Hungary to identify, detect and effectively dispute cases of aggressive tax planning involving the inaccurate application of a Transfer Pricing (“TP”). This is still considered one of the most challenging topics in the international tax environment.
Hungary is taking some steps to limit the practices of usage of aggressive tax planning structures, by implementing European and internationally agreed initiatives (Country Report 2019)
The support project follows the 2019CR to strengthen the Hungarian tax system against a risk of aggressive tax planning. Moreover, the project is linked to European Commission’s priorities for 2014-19 (“A deeper and fairer internal market”, with a particular emphasis on tackling tax abuse and tax fraud). Inaccurate application of the transfer pricing rules is one of the (key) mechanisms identified within the EU and globally, it is also the most likely to facilitate aggressive tax planning.
The support measures cover:
1) Design and delivery of a comprehensive capacity building program in TP (train-the-trainers program)
2) Review and recommendations on strengthening existing TP legal framework together with recommendations on development of TP administrative infrastructure based on identified best practices of MS tax administrations.
The project aimed at enhancing and improving transfer pricing skills and building sustainable capacity within the Hungarian authorities in transfer pricing risk selection, audit and dispute resolution. Over the longterm, the support should contribute towards improved revenue collection, by improving quality of control activities in the field of TP and handling effective disputes in situations of misuse of TP rules by taxpayers.