China’s State Taxation Administration (STA) issued on March 19 a consultation draft (Consultation Draft) of "Public Notice on Matters Concerning the Application of a Simplified Procedure to Unilateral Advance Pricing Arrangements (APAs)" on its official website. The simplified procedure introduced in the Consultation Draft requires fewer steps and provides a timeline of 9-12 months to complete a unilateral APA application process.
The proposed establishment of the simplified procedure is intended to improve the unilateral APA application process and encourage taxpayers’ use of unilateral APAs to achieve tax certainty on their transfer pricing. This procedure is expected boost the popularity of unilateral APAs as taxpayers may find that APAs offer more benefits than just tax certainty.
