Tax authorities are requiring more financial documentation, issuing more comprehensive audits, and imposing more harsh penalties for the abuse of transfer pricing.

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Tax authorities have been tightening their regulations on transfer pricing in recent years. They are requiring more financial documentation to ensure companies are conducting transactions with related parties at arm's length. They are also issuing more comprehensive audits to detect any discrepancies in transfer pricing practices. Penalties for the abuse of transfer pricing have also become more severe to deter noncompliance.

Tax Authorities Are Requiring More Financial Documentation, Issuing More Comprehensive