Leveraging AI for Transfer Pricing Strategy Development and Execution: A Practical Approach

Abstract—Integrating artificial intelligence (AI) into transfer pricing strategies offers excellent opportunities for global companies to optimize taxes, thereby optimizing business strategies across international borders. This paper proposes a practical approach to an AI-driven framework for the development and execution of transfer pricing strategies. This paper also focuses on compliance, risk management, global profit optimization, and organizational value creation, which are considered to face increased scrutiny from tax authorities worldwide. The paper proposes a step-by-step approach that integrates AI technology into various stages of transfer pricing, from data analysis to documentation. With AI's data analytics, predictive modeling, and decision-making, companies can enhance accuracy and efficiency to meet compliance while enhancing business decisions. The framework discussed provides a practical guide for global organizations to navigate global taxation complexities. Keywords—Transfer pricing, Artificial Intelligence, Machine Learning, Data Analysis, OECD, Pillar 1, Pillar 2, BEPS, NLP, Automation.