Cross-Jurisdictional Tax Legislation and Policy Transplants: Bangladesh’s Adoption of India’s Transfer Pricing Framework

This article examines the extent to which tax legislation from one jurisdiction can be effectively adopted in another. This is done by focusing on an example where Bangladesh’s transfer pricing (TP) legislation largely adopts India’s TP legislation, with little originality. The author argues that while such replication may lead to tax harmonization and potential uniform outcomes across the two jurisdictions, it does not necessarily ensure true harmonization of tax policies. It is emphasized that a successful transfer of tax legislation requires it to be adopted in the new context and aligned with the borrowing country’s unique principles, legal traditions and economic context. The article contends that superficial imitation without a deep understanding of the originating country’s experience and context can result in suboptimal outcomes for the adopting jurisdiction.