The Namibian Income Tax Act (Section 95A) empowers the Receiver
of Revenue to adjust the consideration paid or received in respect
of an international transaction between connected persons to
reflect the arm's length price for goods or services in
determining the taxable income of the Namibian taxpayer.
Practice Note 2/2006 requires a taxpayer to compile a Transfer
Pricing policy document setting out the basis upon which prices are
set for international transactions between connected persons. This
will be the taxpayer's defense in showing that a price charged
between connected persons is an arm's length price (i.e. what
unconnected persons would have charged under the same
The Practice Note is primarily based on the transfer pricing
guidelines provided by the Organization for Economic Cooperation
and Development (OECD). The OECD has recently launched a number of
initiatives aimed at improving the current transfer pricing
Simplification and clarification of current transfer pricing
guidelines seem to be the area of focus for the newly appointed
head of the OECD, Ms Marlies de Ruiter. The following initiatives
were launched during June 2012:
OECD TP initiatives
OECD released a discussion draft on the transfer pricing
aspects of intangibles;
OECD released a discussion draft on the revision of the Safe
Harbours section in Chapter IV of the OECD Transfer Pricing
OECD invited comments on certain transfer pricing timing
OECD updated the Multi-Country analysis of Existing Transfer
Pricing Simplification Measures.
By establishing a forum to promote the sharing of resources, the BRICS countries may be able to provide working solutions for the problems being experienced by developing nations in applying the OECD methods.
A discussion on a recent case, where SARS suspected the defendant for having had fraudulently manipulated invoices so as to pay less duty, thereby committing various offences under the Customs and Excise Act.
The Financial Mail reported in its January 25 edition that SARS is considering changing the basis of customs valuations from the present free-on-board principle to a valuation based upon cost, insurance and freight.
Section 66 of the Income Tax Act No. 58 of 1962 requires the Commissioner to give public notice annually of the prescribed time period within which persons who are liable to taxation under the Act must furnish their tax returns.
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