APA Statistics– FY 2023-24

Applications Filed & Agreements Signed

* includes 17 with rollback term
**includes 18 with rollback term

Sectoral Distribution of Agreements Signed

Prominent Industrial Distribution of Agreements Signed

APA Statistics– Till Date

UAPA

BAPA

Other Important Points

• During FY 2023-24, the 86 UAPAs entered into had 224 covered international transactions, and the 39 BAPAs entered into had 181 covered international transactions.
• UAPAs involve associated enterprises (AEs) spread across 74 countries, with the majority being in the United States, the United Kingdom, Singapore, Australia, and Germany.. In the case of BAPA, the USA is the front-runner. Other treaty partners include the UK, Japan, Singapore, Germany, and France..
• The total years (including Rollback years) of tax certainty covered by the APAs signed to date is 3430 years (with 714 years covered by APAs entered in FY 2023-24).
• The income certainty contributed by APAs entered during FY 2023-24 is estimated at INR 25,000 Crore, resulting in tax certainty amounting to approximately INR 7,500 Crore.
• The average duration for closure of applications is around 54.65 months for UAPAs and approximately 63.11 months for BAPAs.
• Out of the APAs signed to date, substantial APAs were benchmarked, considering TNMM and theOther method as the most appropriate, followed by the CUP method.
• Most applicants who have signed APAs have again opted to file a renewal.
• The cases being resolved under MAP have been steadily increasing, and the number of MAP applications closed during calendar year 2023 is 115.

KNAV Comments

The 6^th Annual APA Report showcases India’s growing maturity in attaining tax certainty from transfer pricing. The year-on-year increase in conclusion and signing of APAs (from 95 in FY 2022-23 to 125 in FY 2023-24) signals Taxpayers as well as the Government’s confidence and faith in this dispute prevention program. It has marked a significant milestone in India’s tax administration, showcasing the Government’s commitment to fostering a business-friendly environment and reducing transfer pricing disputes. This achievement not only reflects the success of the APA programme in ensuring tax certainty for multinational enterprises but also highlights India’s proactive approach to resolving complex international tax issues. Such progress reinforces India’s position as a credible and efficient jurisdiction for cross-border transactions. Further, the increasing trend of BAPAs shows taxpayers’ perception of security and safeguarding against potential or actual instances of double taxation in different jurisdiction.

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