International transfer pricing with tax differentials Refer to Exercise 9.1. The corporate income tax rate in Romania
Question:
International transfer pricing with tax differentials Refer to Exercise 9.1. The corporate income tax rate in Romania is 16%, and in Germany it is 30%.
Required:
1. Similar to Figure 9.6, find the tax minimising transfer price for intra-company sales from the memory division in Germany to the assembly division in Romania.
2. Explain whether your belief whether this tax minimising transfer price is feasible.
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