I promise I'm not arranging my work calendar around the World Cup schedule. But if the second half of the afternoon match just happens to align with a lunch break, I don't complain.
To expunge any guilt surrounding this mindset, I settled on a compromise committing myself to extracting any transfer pricing lesson available from the Beautiful Game, no matter how tenuous.
So I dutifully imagine the global rivalry of transfer pricing as a World Cup match. The referees, most obviously, represent jurisdictional tax authorities. The only (ok, not only) wrinkle is that there are two head refs, one from each jurisdiction of the two competing teams. The refs are paid for each goal scored: a commission assigned to each based on the relative contribution of the good offense and bad defense that led to the goal. Helpfully, each referee earns a different commission rate, and interprets the rules of the game (set in part by FIFA/the OECD) somewhat differently and usually to their own advantage.
The two teams are different entities within a multinational enterprise. They are theoretically supposed to operate in a purely competitive manner, but they happen to have the same manager, and the referee compensation structure means they have incentive to collude on the number and direction of the goals. A few take strategic advantage of this arbitrage opportunity, but most simply try to figure out each referee's rules and avoid paying twice on the same commission base, assisted by noble and dedicated independent advisors (the real heroes of the match).
Meanwhile, the fans cheering on the sideline are investors, increasingly interested in betting on obscure aspects of the match rather than urging their own side to a hard-fought win.
I will take this metaphor no further, both out of respect for my readers' continued enjoyment of the real-life tournament, and to eschew retaliation from each FIFA and the international tax community for the egregiously unfair and unflattering comparisons. But as millions of Americans return to their quadrennial tradition of relearning what "nutmeg" and "parking the bus" mean, spare a thought for the perennial struggles of the TP athlete.
For help navigating global taxation, contact Eide Bailly International Tax.
