Digitalization of transfer pricing tax control processes in the State Tax Service

The State Tax Service of Ukraine, with the support of EU4PFM, has created a unique IT solution, taking into account the requirements of Article 39 of the Tax Code and in order to implement the National Revenue Strategy until 2030, approved by the Cabinet of Ministers of Ukraine on December 27, 2023, No. 1218-p: "Big Data Transfer Pricing, an automated system for working with large data sets to analyze transfer pricing risks, to improve tax control over transfer pricing (TP).

In order to combat tax evasion by multinational corporations and the withdrawal of funds to tax havens, which causes Ukraine to lose billions of hryvnias in taxes, the STS has developed an innovative and modern IT solution.

It should be noted that only a few countries in the world use similar software products.

With the help of the latest development, the STS can now analyze a large amount of data from customs clearance, tax and other reports, as well as information from international analytical resources more efficiently.

Using more than a hundred automated risk-based algorithms, the IT system will help to quickly identify TP risks.

Transparency and the use of unified approaches and digital technologies in tax control ensure fairness and a level playing field for business.

The implementation of this IT system allows to

- improve risk-based approaches;

- unify, standardize and automate TP tax control processes;

- reduce the number of TP tax violations and litigations;

- minimize the impact of the human factor.

EU4PFM continues to support the State Tax Service in implementing modern progressive practices and IT technologies aimed at increasing transparency and digitalization.