The seismic economic shock caused by the coronavirus (COVID-19) pandemic and in particular both demand and supply disruptions, is causing multinational corporations to reassess existing transfer pricing policies and consider making retrospective inter-company transfer pricing adjustments or additional payments.
Different customs risks and opportunities exist depending on the direction of the transfer pricing adjustments or classification of any additional payments.
In the current high-tariff environment—i.e., with tariffs as high as 25% on many imported goods—the customs duty cost implications can be significant.
Read a May 2020 report [PDF 113 KB] prepared by KPMG LLP that highlights pertinent compliance and planning issues involved with these opportunities, which often require advance customs, accounting, and transfer pricing coordination and planning: What’s News in Tax: Transfer Pricing Changes May Result in Potential Customs Tariff Opportunities in a COVID-19 Environment
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