Effects of base erosion and profit shifting Action Plan (BEPS) on transfer pricing legislation in Turkey

Differences in international financial legislation, caused by local tax regulations adapting to neoliberal economic policies, have become a tool of aggressive tax planning and provided profit transfer (BEPS) opportunities to MNCs through base erosion. The fact that the situation eroded national tax revenues to a large extent and the 2008 global financial crisis plunged the countries into a major resource crisis. The "BEPS Action Plan", the technical infrastructure of which was created and implemented by the OECD upon the request of the G20, identified 15 problematic areas that provide BEPS opportunities to the MNC, and presented some recommendations and minimum standards to the implementing countries to adapt them to their local legislation. It is aimed that the actions of the Action Plan regarding transfer pricing and the results of transfer pricing are compatible with the value created. In this revision, the concept of intangible assets has been reconsidered with a broader perspective. The arm's length principle has been reformed with a perspective that emphasizes risk in order to determine the actual nature of transactions. In this context, DEMPE Analysis has come to the fore in order to determine royalties and to determine the compatibility of the result with its peers in terms of transfer pricing. The "Fifth Section" that OECD TFR reserved for "Certification" has been completely deleted and new obligations have been introduced reflecting the three-stage standardized approach. As a post-neoliberal fix for a neoliberal flaw, the transfer pricing actions of the "BEPS Action Plan" were partially, if not completely, reflected in the Turkish financial legislation. The reason for the OECD to reveal the BEPS Action Plan is that the aggressive tax planning of the MNCs, which were the important actors of the process during the implementation of neoliberal economic policies, brought the national finances of developed countries into an inextricable situation. In this process, large bases that should be under the control of financial administrations of developed countries are disappearing in developing countries, which are the actors of the race to the bottom in tax competition. The reason for the partial inclusion of the Turkish Financial Legislation in this convention seems to be to keep a distance as much as possible, as the effects of the Action Plan will not be in favor of a developing country.