KPMG in Bangladesh hosts session on corporate tax, transfer pricing

Rahman Rahman Huq, Chartered Accountants (KPMG in Bangladesh), conducted an in-depth session entitled "New Corporate Tax Landscape and Transfer Pricing" at the Chittagong Export Processing Zone (CEPZ), providing a comprehensive overview of Bangladesh's evolving fiscal framework, EPZ operations, and emerging international tax developments.

M Mehedi Hasan FCA, Partner at Rahman Rahman Huq, presented the keynote paper. The session also included insights from Soyeb Ahmad Chowdhury FCA, Head of the Chattogram Branch; Sarker Nahidul Islam FCA, Director of Tax and Advisory Services; Mohammad Fuad Uddin Khan FCA, Director of Transfer Pricing Services; and SK Aminul Islam FCA, Associate Director of Tax. The event concluded with an interactive question-and-answer session.

Speakers highlighted the continued importance of export processing zones in driving Bangladesh's industrial expansion, export diversification, and foreign investment under the Bangladesh Export Processing Zones Act 1980. They noted that investors benefit from key fiscal incentives – including a 12% reduced corporate tax rate, income tax holidays of five to seven years, zero-rated VAT on exports, and duty-free import of raw materials and machinery until 2030 – as well as cash incentives of 0.3% to 10% across sectors such as ready-made garments, pharmaceuticals, IT, jute, and agro-processing.

The discussion placed strong emphasis on transfer pricing (TP) compliance, noting that the National Board of Revenue (NBR) has commenced TP audits for the first time since introducing TP regulations into Bangladesh's tax regime. This development marks a significant step towards aligning with international tax transparency standards and curbing profit shifting through cross-border transactions.

Experts cautioned that incomplete or unreliable TP documentation may lead to penalties of 1% to 4% of transaction value, urging companies to strengthen compliance frameworks and ensure accurate reporting. They also discussed the First Sale for Export (FSFE) mechanism for United States-bound exporters and global developments under the OECD's BEPS Pillar Two framework, which introduces a 15% global minimum tax for large multinational groups – although Bangladesh is not yet a signatory.

Through this initiative, Rahman Rahman Huq (KPMG in Bangladesh) reaffirmed its commitment to promoting transparency, compliance, and sustainable fiscal governance within Bangladesh's evolving tax and transfer pricing landscape.