October 8, 2021
Jordan issues transfer pricing instructions
On 16 September 2021, the Hashemite Kingdom of Jordan published Executive Instructions No. (3) of 2021 (the Instructions) in the Official Gazette. The Instructions provide further details on the application of the new transfer pricing (TP) rules that became effective in July 20211 and also prescribe the forms that taxpayers should use for filing the TP Disclosure and the Country-by-Country (CbC) report.
The Instructions do not specify when taxpayers need to start complying with the new rules. It also appears that taxpayers are expected to file a copy of the full CbC report in Jordan, even if the original is filed outside Jordan by an Ultimate Parent Entity or a Surrogate Parent Entity.
In the absence of further guidance from the Income and Sales Tax Department (ISTD), for any reporting period ending after 7 July 2021:
Jordan-based entities should start reviewing their TP policies and related-party pricing arrangements so they will be able to meet their compliance requirements on a timely basis.
For additional information with respect to this Alert, please contact the following:
Ernst & Young Jordan, Amman
Ernst & Young LLP (United States), Middle East Tax Desk, New York