The Future of Transfer Pricing: Artificial Intelligence and Its Implications for Tax Authorities

Abstract

This research paper explores the evolving landscape of transfer pricing and its intersection with artificial intelligence (AI). Transfer pricing, the pricing of intercompany transactions, plays a crucial role in multinational corporations' tax strategies. With the increasing complexity of global tax regulations and the rise of digital economies, tax authorities face significant challenges in ensuring compliance and preventing tax avoidance. This paper discusses the current state of transfer pricing, the role of AI in enhancing compliance and enforcement, and the implications of AI for tax authorities. By examining case studies and emerging trends, we aim to provide insights into how AI can shape the future of transfer pricing and its regulatory environment.