Judicial Review of Transfer Pricing Cases at the Supreme Court Level in Indonesia

Abstract

Supreme Court review of transfer pricing disputes significantly affects the balance of power between tax authorities and multinational enterprises. This paper analyzes Indonesian Supreme Court rulings on transfer pricing cases to assess their implications for tax justice. Using case law analysis, the study examines standards of proof, evidentiary requirements, and interpretations of the arm’s length principle. The findings suggest that strict formalism often disadvantages tax authorities, particularly in cases involving complex cross-border transactions. The paper argues that judicial reluctance to engage with economic substance undermines effective enforcement. The global contribution of this study lies in highlighting how apex court jurisprudence shapes the practical enforceability of international tax rules. Indonesia’s experience offers lessons for strengthening judicial approaches to transfer pricing disputes in developing countries.