MNCs hides transaction information

Around 771 multinational companies (MNCs) are continuously keeping their international transactions confidential. A recent survey conducted by the National Board of Revenue (NBR) has revealed such information. According to NBR information, to stop tax evasion and prevent money laundering, the authority started to collect information around 921 MNCs who conduct international transactions from the country.

NBR’s ‘Transfer Pricing Cell (TPC)’ in their primary survey showed, of the total companies about 771 MNCs do not file the Statements of International Transactions (SIT) with their income tax returns as per the law. These companies including their branches, liaison and representative offices are doing business in different sectors inside the country, only 150 of them regularly file their SITs, the rest do not.
Now TPC wanted detailed information on these companies’ profiles and activities for further investigation of their international transactions aiming to find out whether they evaded taxes. The MNCs will have to provide the required information by January 15.

In this regard, on condition of anonymity a senior official of NBR said, as per the NBR chairman directives, TPC started to collect information of 921 MNCs information. These companies have been subjected to step by step inspection. It is to be noted, earlier NBR restructured the TPC. The joint director general of Central Intelligence Cell Md Shabbir Ahmed is coordinating the pricing cell.

TCP is now investigating, whether the companies filed income tax returns and SITs since Fiscal Year 2013-2014 to until now and the functional relation of the entities with the parent companies and other associated enterprises. At the same time, they are also asked to provide information of ownership profiles, type of entities, period of operation in Bangladesh, main activities in the country, areas of activities, status of employees, names of top employees, information on bank accounts maintained and how they meet the expenses of operations in the country.

The allegation is that those MNCs illegally transferred thousands of crores of taka every year. MNCs evade tax by misusing the transfer pricing system through over-invoicing and under-invoicing during transactions of goods and services within their associate companies.