Poland and Latvia Shared Experience in the Framework of IOTA Peer-to-Peer Technical Assistance Project “Intangibles and DEMPE Analysis”

Erika Szabó's picture
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The first IOTA Peer-to-Peer Technical Assistance Project initiated in 2022 was successfully implemented by the National Revenue Administration (NRA) of the Republic of Poland as the Provider and the State Revenue Service of the Republic of Latvia (SRS) as the Beneficiary. The main purpose of the Project was to improve the SRS employee knowledge and understanding of DEMPE functions regarding distribution of profits generated by a group's intangibles while respecting market principles (as per the OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations, January 2022).

The Project’s core activity was a digital Workshop held on 1-2 February 2023 in which NRA presented to SRS some theoretical aspects and gave practical examples on intangibles’ evaluation and the use of DEMPE analysis during APA procedures. Further on, the parties focused on exchanging experience and views on practical APA cases. The main benefit for SRS was that it could hear about first-hand experience on how NRA deals with transfer pricing cases that involve intangibles and how each of the DEMPE functions is evaluated.

As a result of a fruitful discussion between both IOTA member tax administrations the conclusion was that each transfer pricing case should be evaluated individually and that there is not one perfect mechanism on how DEMPE functions should be analysed.

Overall, the parties agreed that the IOTA Peer-to-Peer Technical Assistance Project is a great way for tax administrations to directly exchange information and experience in different fields.

Find out more about the Project by visiting the dedicated Project page on the IOTA website.