Right of the taxpayers to protect personal data

Data protection and privacy are recognised as fundamental rights. An individual's 'private life' includes the protection of his or her personal data. Personal data, in principle, is information that identifies an individual, or is related to the individual. Most of the countries in the world includes a right of privacy in their Constitutions. In many countries, international instruments that recognise privacy rights such as the International Covenant on Civil and Political Rights or the European Convention on Human Rights have been adopted into domestic law.

The Finance Act 2022-23 makes compulsory submission of income tax return and obtaining of acknowledgement receipt having information of income, assets and total tax paid etc. for obtaining registration of co-operative society; obtaining or renewal of license or enlistment as a surveyor of general insurance; obtaining registration, by a resident, of the deed of transfer, obtaining or maintaining a credit card; obtaining or continuing the connection of electricity in a city corporation or cantonment board. The acknowledgement receipt form issued by the National Board of Revenue (NBR) is the proof of income tax return submission before a certificate is ready, and it reveals the taxpayer's gross wealth, taxable income and tax paid, inadvertently disclosing such confidential information to third parties. Experts opined that this is a violation of the Income Tax Ordinance, 1984 and the draft Income Tax Law 2021. This compulsion of disclosure of private information is against many laws of the country.

The Constitution of Bangladesh under article 43 grants every citizen the right, subject to any reasonable restrictions imposed by law in the interests of the security of the state, public order, public morality, or public health, to the privacy of his/her correspondence and other means of communication. The Constitution does not expressly grant the fundamental right to privacy. There are many laws and rules for security of personal data of the citizens, and the government has drafted a Data Protection Law and asked for opinion of different stakeholders. This was recognised by the High Court Division of the Supreme Court of Bangladesh in the State v Oli (2019), where the court observed that 'every citizen was entitled to the right to privacy under the Constitution'.

Sections 7(h),(i),(j)and (r) of the Right to Information Act provide that any information which may offend the privacy of one's life, any information which may endanger life or physical safety of any person, any information given secretly to assist the law enforcing agencies, or any personal information protected by any law, are not subject to mandatory disclosure by government and certain private organisations. That means anybody cannot get any information regarding privacy or personal data.

On the other hand, the information collected by Government is a resource of the citizen and managed on their behalf by Government. There is no general right for people to see the information held by government departments. People should be able to obtain access to these resources and to participate in government policy development and decision making.

Freedom of information and privacy Act or Rule aims to ensure that the information collected about people by government agencies is accurate and not misused. People do not have any obligation to disclose their financial situation to even their close ones, but the new finance Act is compelling taxpayers to disclose such sensitive information to unauthorised third parties.

The Income Tax Ordinance 1984, under section 163(1) restricts that all particulars or information contained in the following shall be confidential and shall not be disclosed, namely:-(a) any statement made, return furnished or accounts or documents produced under the provisions of this Ordinance; (b) any evidence given, or affidavit or deposition made, in the course of any proceedings under this Ordinance other than proceedings under Chapter XXI; (c) any record of any assessment proceedings or any proceeding relating to the recovery of demand under this Ordinance. Although the tax payer may disclose and sections 163-6 shall not be construed as prohibiting the voluntary disclosure of any particulars referred to in sub-section (1) by the person by whom the statement was made, return furnished, accounts or documents produced, evidence given or affidavit or deposition made, as the case may be.

The draft Income Tax Law in chapter 19 and section 297(1) gives priority itself over other laws of the country and declares all the information related to income, expenditure and asset disclosure as prohibited. Even the court is not as such allowed to instruct for presentation of these information under the Evidence Act, 1872. Under section 297(3)(a), the court may requestfor that informationin accordance with the Penal Code, 1860 and the Foreign Exchange Regulation Act, 1947.

Moreover, the National Board of Revenue (NBR) has launched a digital system to verify the authenticity of tax-return submissions and expedite service delivery by the authorities concerned. Its income-tax wing officially opened the 'tax return verification module' on August 21, 2022. Anyone from across the country can verify the authenticity of the return submission by inserting Taxpayers Identification Number (TIN) in the module, available on the NBR's website. Any other authorities may come into an arrangement with NBR to verify the acknowledgement receipt without disclosing the private data and abide by the different laws ensuring the right to private data of the citizens.

It appears that the Finance Act 2022-23 is contradictory to Income Tax Ordinance 1984 and other laws, and this is why, the Finance Act should be amended to protect the private information of the taxpayers.

The writer is Non-Government Adviser, Bangladesh Competition Commission.