The government will not allow legalisation of undisclosed money in the next budget for fiscal year 2014-15, finance minister Abul Maal Abdul Muhith said on Thursday.
‘There will be no scope for whitening of black money in the coming budget,’ he said at the 35th consultative committee meeting at Pan Pacific Sonargaon Hotel.He, however, gave no further explanation on the issue though there are some provisions in the Income Tax Ordinance-1984 on
investment of undisclosed money in income generating sectors and real estate sector by paying tax at different rates.
The National Board of Revenue and the Federation of Bangladesh Chambers of Commerce and Industry jointly organised the meeting to discuss the budget proposals made by the stakeholders.
Muhith also said that the government would fix a fresh threshold of tax-free income for individual taxpayers in the next budget for long-term and the threshold might remain unchanged for next 10 years.
He said that the government would continue its support to protect domestic industries and build a fund to give refund to the taxpayers who paid in excess as advance income tax.
He also hinted on increasing tax on tobacco products considering its harmful effect on public health.
NBR officials said that they were yet to get any directives on scrapping the provision of legalising undisclosed money in the next budget.
Earlier in last week, NBR chairmanm Ghulam Hussain at a pre-budget meeting said the scope of legalisation of undisclosed money should continue saying that it would prevent capital flight from Bangladesh.
He, however, admitted that the facility could not bring any positive impact in sectors like stock market and real estate business.
According to NBR statistics, around Tk 14,000 crore undisclosed and illegal money was whitened and the revenue board got around Tk 1,500 crore in taxes by providing the opportunity till FY 2012-13.
The NBR provided the scope of legalizing undisclosed money in different forms in many budgets since 1976 despite criticism from economists, businessmen and civil society members.
Currently, there are provisions in the Income Tax Ordinance-1984 for legalising untaxed or undisclosed money through investment in different sectors.
The NBR would not asked any question about the source of income in case of investment of undeclared money in constructing and buying residential houses and apartments by paying taxes at fixed rate and in buying land and plot by paying 10 per cent of the price of the land or plot.
Taxpayers will also be able to legalise their undisclosed money by investing in any income generating sectors including stock market by paying 10 per cent penalty tax along with the regular tax at the rate of 25 per cent.
No question will be raised if the money is invested in the Government Treasury Bond and Bangladesh Infrastructure Finance Fund by paying tax at the rate of 10 per cent.
At the meeting, FBCCI president Kazi Akram Uddin Ahmed wanted the opportunity for investing untaxed money in the next budget in productive sectors including infrastructure, technical education, human resource development, agricultural sectors and technology development.
Muhith also instructed the NBR for paying more attention and efforts in collecting tax properly from tobacco products and import of reconditioned and new cars.
He said that the revenue board would have to raise the country’s tax-gross national income ratio to 18 per cent in next five years from the existing 13 per cent.
At the meeting, state minister for finance and planning MA Mannan, NBR chairman Ghulam Hussain, among others, spoke.
-With New Age input
