Tax cheats can whiten money until Nov 30 | The Daily Star
12:00 AM, August 05, 2020 / LAST MODIFIED: 01:10 AM, August 05, 2020

Tax cheats can whiten money until Nov 30

Amnesty to black money has always been a nonstarter, so Finance Minister AHM Mustafa Kamal's move to tuck in the facility with added benefits in this fiscal year's budget has left many scratching their heads.

But it now appears the government is racking its brains to ensure the provision is a success this time.

In its latest move, the National Board of Revenue has set a deadline for tax cheats who want to legalise their untaxed money.

To avail the opportunity, they have to declare their untaxed asset and pay the stipulated tax while submitting their income tax returns within November 30.

A notice would be issued by early next month detailing all aspects for whitening the black money, said a revenue official working on the matter. He wished to remain unnamed as he is not authorised to speak with the media.

This comes after the NBR last week came up with a declaration form for tax cheats interested in investing their undisclosed wealth with the capital market on paying taxes at a rate of 10 per cent.

The facility was added in fiscal 2020-21 and the investments would be locked in for a year.

The individual has to declare and give the stipulated tax within one month of pouring in the untaxed money in the stock market.

Besides, the individual has to provide particulars including his/her NID and TIN numbers, contact details, amount of money deposited in the share market, the beneficiary owner's account, the name of the brokerage house, among others.

From this fiscal year, individual taxpayers will be allowed to disclose any type of undisclosed properties, including land, building and flat, by paying tax at a particular rate on per square metre.

Individual taxpayers will also be able to make any disclosure of undisclosed cash, bank deposits, savings certificates, bonds or any other securities on paying taxes at a rate of 10 per cent.

No authority, including the NBR and the Anti-Corruption Commission, would be able to raise any question on such declarations.

Until last fiscal year, tax cheats were able to whiten their assets by investing in residential buildings by paying a tax of 10 percent on the amount invested, which for regular taxpayers is between 10 and 30 percent. They will also not face any questions about the sources of their income if they invest in economic zones and hi-tech parks.

In the upcoming weeks, the tax administration would run ads in newspapers and televisions, commission TV programmes and publish leaflets and brochures to inform of the added privileges this fiscal year and also encourage people to bring their untaxed money to the mainstream economy.

The NBR would particularly highlight the opportunities introduced in the current budget that no questions would be asked about the sources of the money disclosed, said an official of the government agency.

In fiscals 2007-08 and 2008-09, Tk 9,682.99 crore was legalised during the regime of the Army-backed caretaker government, which was the highest in the country's history, NBR data showed.

In the previous two governments of the Awami League, Tk 1,805 crore and Tk 4,856 crore were respectively legalised. 

Meanwhile, in a curious development, deposits at different banks are increasing significantly, which many bankers construed as people parking their untaxed money with lenders after the widened amnesty for black money was declared in June.

The correspondents learned of the rudimentary correlation after speaking with several bank officials from different branches.

"We can easily tell that they are not 'running money'. They have a damp smell and look," said an official of a private bank's Shantinagar branch requesting anonymity.

He said they have many clients who are involved in businesses and public services.

Pubali Bank, a top a private bank, has received Tk 3000 crore more deposit in June, compared to December last year.  Officials of several other banks also said they were receiving more deposit in June and July compared with the previous months.

MA Halim Chowdhury, managing director of Pubali Bank, however, dismissed the correlation.

The high flow of remittance and several restrictions on different saving instruments are the reasons behind the increase in deposits in June and July, he said.

The bank has received Tk 3,000 crore more in deposits in June than in December last year.

In June, deposits in the banking sector registered a growth of 2.07 percent from May, when the growth stood at 0.83 percent. June's growth was the highest last fiscal year, according to data from the Bangladesh Bank.

The outstanding deposit of commoners excluding the government and inter-bank credit stood at Tk 11,810,251 crore as of June.

 

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