Daily Tax Update - April 29, 2015: OECD Releases Discussion Draft on Cost Contribution Arrangements

OECD Releases Discussion Draft on Cost Contribution Arrangements:  Today, the OECD released a discussion draft in connection with Action 8 (“Assure that transfer pricing outcomes are in line with value creation”) of the OECD’s BEPS Action Plan.  The discussion draft proposes updates to the OECD Transfer Pricing Guidelines regarding cost contribution arrangements (CCAs), i.e., contractual arrangements among business enterprises to share the contributions and risks involved in the joint development, production, or the obtaining of intangibles, tangible assets, or services.  The proposed changes to the Transfer Pricing Guidelines would require contributions to be measured at value rather than at cost.  The discussion draft states that this change would help “ensure that outcomes for participants under a CCA should not differ significantly from the outcomes of transfers or development of intangibles for parties outside a CCA.”

Senate Finance Committee Releases Tax Reform Working Group Submissions: Today, the Senate Finance Committee released comment letters sent to the committee’s individual income tax, business income tax, international tax, savings and investment, and community development and infrastructure working groups.