Australian Tax Office Consults Draft Update to Transfer Pricing Guidance for Inbound Distribution Arrangements

The Australian Taxation Office (ATO) has released Draft Practical Compliance Guideline PCG 2019/1DC for consultation, setting out proposed updates to PCG 2019/1 on the ATO’s transfer pricing compliance approach for inbound distribution arrangements.

Key aspects of the draft update include:

• Revised (including reduced) operating margin benchmarks for certain sectors, including life sciences and information and communication technology (ICT), reflecting updated benchmarking/economic data;
• A c…