A meticulous analysis is necessary in order to assess the opportunity for implementing the system of transfer prices in RM

In my opinion, a meticulous analysis is necessary for assessing the opportunity for implementing the system of transfer prices in Republic of Moldova.

„Although sooner or later the system of transfer prices has to be implemented in R. Moldova, I do not think now is the best time to implement it, given the advanced speed with which R. Moldova’s legislation is being harmonized with and adjusted to the EU norms. At present, however, it is not the best moment to start implementing it”, such were the statements of Viorel Dandara, director of Priminfo–Grup, being interviewed by the Russian-language newspaper ”Экономическое Обозрение”.

The newspaper requested the opinion of Priminfo–Grup director in the context when the Ministry of Finances had drafted a package of documents foreseeing the implementation of the transfer prices system in Republic of Moldova, beginning with the year 2015.

“We should not rush, since it is not the best moment for starting to apply this system, as it might frighten and create tension among foreign investors. It is true that as a result of implementing the new system the state budget might gain additional income worth several million MDL, but we should not disregard the fact that R. Moldova will be likely to lose certain potential foreign investors. In the given situation, we must have a more complex approach for managing the economic processes. Thus, if the regulatory and legislative framework at the chapter of transfer prices forming shall be similar to the EU one, then R. Moldova as a state will not be attractive to investors any more”, Viorel Dandara declared.

According to Dandara, this system is more likely to affect the big investors, and not the small or average ones. For the former, this will be like a burden and will imply additional costs. „Apart from the fact that it is very expensive to ensure the connection to specialized databases, the companies will be forced to apply to consultancy companies in order to receive assistance for developing the transfer prices folders. As regards the goods, things will be simpler here, as there is the stock exchange which can provide some statistical data. Things will get more complicated in the case of service providing companies and non-material assets. For example, as regards payments in form of royalty”.

„Otherwise, the issues related to implementation shall be well felt by the tax bodies, as well as tax-payers”, Viorel Dandara, director of Priminfo–Grup, concluded.