Emerging Economies and the International Taxation Battle: Transfer Pricing at the Forefront

Abstract

The rapid globalization of trade and investment has led to an increased focus on international taxation, particularly on the role of transfer pricing. Emerging economies, which have experienced accelerated economic growth, are increasingly engaged in multinational activities and foreign direct investments. However, this growth has come with significant challenges, especially in ensuring that they receive a fair share of tax revenues from multinational corporations (MNCs). Transfer pricing, the pricing of transactions between related entities within MNCs, has become a critical issue in the international taxation arena. The focus on transfer pricing disputes has intensified, as emerging economies struggle to implement efficient tax policies that balance growth with revenue collection. This paper examines the impact of transfer pricing on emerging economies, the international response to these challenges, and the strategic role these economies play in shaping global tax norms.