• Friday, May 27, 2022
  • Last Update : 04:24 pm

Undisclosed income can be legalized by paying 10% tax

  • Published at 07:56 pm May 22nd, 2021
web-black money
Representational image Syed Zakir Hossain/Dhaka Tribune

 Tk10,000 crore of black money has been whitened in the first six months of this fiscal year

Like the current fiscal year, the budget for the 2021-22 fiscal year will also provide people with the opportunity to legalize undisclosed income by paying 10% taxes.

Nazrul Islam, a former economics professor at the University of Dhaka, told Dhaka Tribune that this is discrimination and injustice. 

“Honest business and taxpayers will pay 32-25% tax but money earned through illegal sources will be legalized with 10% tax — this is unethical,” he said.

By legalizing black money as “undisclosed assets” and showing the crime as insignificant, there is no possibility of black money ever disappearing from the system, he added.

Also read - Kamal: Black money whitening scheme will remain

Shahriar Hossain, a member of the Bangladesh Economic Association (BEA), said the income of those who earn money outside of business and employment should not remain undisclosed. 

“The decision may help the banks, and the real estate and capital markets,” he added.

He also mentioned that the provision for legalizing undeclared income may have increased the number of deposits in some bank accounts. 

“The growth rate of deposits in these accounts is higher than the growth rate of normal deposits,” he further said.

On Wednesday Finance Minister AHM Mustafa Kamal stated that people will have the scope to legalize black money without question in all areas including cash, bank deposits, stock market, and flat purchases.

The minister also said that Tk10,000 crore of black money has been whitened in the first six months of this fiscal year. 

According to the National Board of Revenue (NBR), in the first nine months of the current financial year, a record amount of assets worth Tk14,295 crore has been validated.

Also read - DCCI seeks gradual corporate tax cuts for 3 back-to-back FYs

According to them, Tk1,439 crore was received as tax against these undisclosed incomes.

On Saturday, Transparency International Bangladesh (TIB) expressed surprise and outrage at the finance minister's statement on extending indefinitely the unethical opportunity given by the government to whitewash black money in the current financial year.

TIB Executive Director Dr Iftekharuzzaman said: “In such a reality, the plan to whitewash the black money indefinitely will highlight the question of fairness and equity in the tax system of the country and will be considered as a new incentive for the corrupt during the coronavirus period. That is why the government is expected to move away from such reckless and suicidal plans.”

He also stated that even though several business organizations have opposed this gap at different times, the government has not listened to it but has turned a blind eye to Article 20 (2) of the constitution.

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