The Central Board of Direct Taxes (CBDT) and state-owned GAIL (India) Ltd. have signed an advance pricing agreement to determine the
transfer price margin owed on the long-term LNG the company imports from the US. Rasmi Ranjan Das of CBDT and R K Jain, Director (Finance), of GAIL signed the agreement, the firm announced in a statement. In order to calculate the transfer pricing margin due on its long-term LNG sourcing contract from the USA for a period of five years, "GAIL and CBDT engaged into a groundbreaking advance pricing agreement (APA)," it added. "The APA plan improves the ease of conducting business in India and advances the government's goal of fostering a non-adversarial tax structure."
The gas utility company has agreements with US suppliers to purchase 5.8 million tonne of liquefied natural gas annually (LNG). The APA was signed by GAIL, the country's first PSU in the oil and gas industry.
