Transfer pricing norms in India inflexible says PWC
New Delhi: According to Keith R Sparkes, director, transfer pricing, tax and legal services, PwC, transfer pricing regulations in India are quite inflexible.

Sparkes is spearheading the transfer pricing team of the consultancy firm in India for the next 18 months and has released a white paper on the issue with several suggestions.

Firstly the paper says the documentation requirements in India are very stringent.

An Indian subsidiary of a multinational company is expected to furbish addresses and names of all its associates, which is an unreasonable requirement. IBM for instance may have hundreds of group companies while few of them may have anything to do with India.

This essentially results in a lot of paperwork as the number of group companies can increase or decrease with each passing day.

Secondly, the regulations require companies to document all transactions with associated firms.

This is also an unreasonable requirement as globally, companies document their transactions in groups or classes.

Another regulation requiring companies to furbish accounts of their associates is unrealistic as a parent company would not furbish all information to its subsidiary.

Documentation rules don't apply to companies that have a total aggregate transaction value of Rs 1 crore.

"That's a fairly insignificant amount and very few companies will be able to take advantage of this safe harbour," says Sparkes.

The government had asked for suggestions on the transfer pricing regulations from industry chambers and consultant firms. The last date for submitting suggestions is May 25.
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Power tariffs up by 22 percent in Delhi
New Delhi: Domestic consumers of power in Delhi will have to pay a 22 percent higher tariff for power while large industrial consumers will have to bear an increase of 7.5 per cent on their electricity bills.
The new tariff structure, issued by the Delhi Electricity Regulatory Commission, DERC, comes into effect from June 1.
The small industrial power category of users will have to pay 10.8 per cent more than the existing rates.
Under the new tariff structure, domestic consumers will have to pay Re 1.50 per unit for the first 100 units against the existing Re 1, and Rs 2.10 per unit up to 200 units (at present Re 1.75), and Rs 3.00 for 200-400 units and Rs 3.60 per unit for above 400 units against the existing rate of Rs 3.00 per unit in this slab.
The tariff for agricultural consumers has also been increased from 50 paise per unit to 75 paise.

It may however be noted that the number of agricultural consumers in Delhi is almost negligible.
Sources said a correction in the tariff structure was in line with the reforms process.

DERC has also made a special provision for the poorest category of consumers who consume less than 50 units a month who will get power at the rate of Re 1.25 per unit

The Delhi Vidyut Board has initiated a reforms process in the state by which the distribution network in the state is being divided into various zones. Almost all leading industrial houses -- from Reliance to BSES -- have bid for the zones.
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