• Thursday, Jan 26, 2023
  • Last Update : 09:24 am

Close to 12,000 taxpayers wash 20,600C black money in FY21

  • Published at 12:30 pm July 7th, 2021
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Representational image Syed Zakir Hossain/Dhaka Tribune

Black money whiteners consisted of doctors, government officials, readymade garment exporters, bank directors, gold traders and others

A whopping Tk20,600 crore worth of black money was whitened in the financial year 2020-21, as nearly 12,000 taxpayers took advantage of this government policy.

The National Board of Revenue (NBR) revealed this on Wednesday, adding that it received Tk2,000 crore in additional revenue as a result.

Black money whiteners consisted of doctors, government officials, readymade garment exporters, bank directors, gold traders and several others. 

More than 60% of them declared undisclosed amounts with 10% tax on various bank deposits, fixed deposit receipts (FDRs), savings certificates or cash.

According to the NBR, between July 2020 and June 2021, 11,859 people bought shares from the stock market, or purchased property to wash away their undisclosed money. 

Also Read - Whitening black money approved, move draws both criticism and praise

Of this, 1,455 taxpayers washed Tk619 crore of their money clean in June this year alone.

Of the 11,859 taxpayers, 7,055 legalized their black money by levying 10% tax on various deposits, FDRs, savings certificates or cash deposited in banks.

They legalized a maximum of Tk16,800 crore by depositing Tk1,683 crore in the state coffers as tax.

Only 246 investors in the capital market legalized their money worth Tk400 crore.

Earlier, 10,404 taxpayers whitened Tk14,459 crore undisclosed money by purchasing property, depositing their cash with banks as FDRs, purchased savings certificates and more until May this year.

The NBR received Tk1,445 crore as tax from this.

In addition, the government has given the opportunity to whitewash black money by levying the same rate in economic zones and high-tech parks in the previous financial year to boost domestic investment. This opportunity is valid until June 2024.

A senior official of NBR, seeking anonymity, said: “The legalization of undisclosed money or funds will increase in the future, as this opportunity will also be present in the new financial year. Our tax officials will check and sort the information on their tax returns.”

The official also mentioned that at the individual level, different classes of taxpayers are taking advantage of distinctive assets such as shares and properties. 

Also Read - Kamal: Black money strengthened stock market

Many taxpayers will declare these assets in their income tax returns, he added.

Earlier, the Centre for Policy Dialogue's Distinguished Fellow Prof Mostafizur Rahman said: “The opportunity of money whitening repeatedly given in the budget is a major obstacle to control corruption. Even after strict policies, an average of Tk50,000-60,000 crore is smuggled out of the country every year.”

"To get out of this situation, we have to try to control money laundering through various surveillance agencies and relevant laws," he added.

TIB Executive Director Dr Iftekharuzzaman said: “In such a reality, to whitewash the black money 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.”

He also asserted 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.

Dr Zahed Ur Rahman, a teacher and civil rights activist, said: “Untaxed money in the economy is known as black money. They are mostly earned through drug trafficking, any prohibited deeds, or bribery. If black money enters into the economy, people with white money will lag behind the owners of black money in every respect.”

This will create imbalance in all economic sectors including business. The main reason behind the laundering of large sums of money in Bangladesh in recent times is the creation of much more black money, he added.

Not mentioning black money in the budget speech, gives an important message to citizens at the last minute while passing the budget. When an honest taxpayer pays more tax than a dishonest taxpayer, it persuades the citizens to be dishonest, he clarified.

On the issue of money laundering, Finance Minister AHM Mustafa Kamal had said at the Parliament on June 7: “I am against these irregularities. These need to be stopped. I do not have a list of people who smuggle money.

“Give us the names of people if you know them. If we can create better investment opportunities, if there is a comparative advantage, then no one will take money abroad," he remarked.

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