Sweeping amnesty sought for undeclared funds in real estate

People should be allowed to invest their undeclared income in the real estate sector without disclosing the source of the money to any government agency, the Federation of Bangladesh Chambers of Commerce and Industry said

yesterday.

At present, one can invest undisclosed money to construct or purchase a building or an apartment without explaining the source of income to the National Board of Revenue.

The present rules do not guarantee that other government agencies will not raise questions about the source of the funds.

If undisclosed money is allowed for investment in real estate with a broader amnesty for 5 to 10 years, the sector will be able come out of its current sluggish trend, the FBCCI said in its budget proposal.

As a result, more revenue will be generated, it said.

“If such laws are not re-introduced, a huge amount of money will be siphoned off. Already money is going out of the country through the ‘Second Home’ programme offered by various countries,” the FBCCI said.

The proposals were placed at a pre-budget meeting co-organised by the apex trade body and the National Board of Revenue at Sonargaon hotel in the capital.

Golam Dastagir Gazi, a ruling party lawmaker and a businessman, said: “We need to think about the undisclosed money afresh, as money is going out of the country.”

Finance Minister AMA Muhith said the upcoming budget will give emphasis on the health and education sectors. So far, transport and energy have been getting higher allocations in the budget.

FBCCI President Abdul Matlub Ahmad expressed his hope that the finance minister will give a specific guideline and long-term plan in the upcoming budget.

He proposed 1 percent customs duty on import of capital machinery or basic raw materials, 3 percent for intermediate goods, 10 percent for locally produced intermediate goods and 25 percent for luxury items. He also called for the withdrawal of advance income tax on import of basic industrial raw materials.

Ahmad demanded reduction of special corporate tax for apparel sector to 10 percent from 35 percent now.

MA Mannan, state minister for finance and planning, underscored the need for reforms and simplification of the revenue system.

The FBCCI also proposed raising the tax-free income limit for individuals to Tk 300,000 in 2016-17 from the existing Tk 250,000.

In case of women and taxpayers of more than 65 years of age, the FBCCI suggested increasing the limit to Tk 325,000 from Tk 300,000 now, and for the physically challenged to Tk 400,000 from Tk 375,000.

The FBCCI proposed a uniform minimum tax rate at Tk 3,000 for people living in and outside city corporations.

The trade body also called for reducing corporate tax for publicly traded companies to 23 percent from 25 percent now, and for non-publicly traded companies to 28-33 percent from 35 percent.

It demanded corporate tax for publicly traded banks, insurance and other financial institutions should be brought down to 38.5 percent from 40 percent now.

For non-publicly traded financial organisations, the rate should be 40.5 percent, down from 42.5 percent now, the FBCCI said.

For merchant banks, the FBCCI proposed bringing down the rate to 35 percent from the existing 37.5 percent.

NBR Chairman Md Nojibur Rahman moderated the meeting, which was also attended by FBCCI First Vice President Md Shafiul Islam and Vice President Mahbubul Alam.