Like capital market, the government may widen the scope of legalising undisclosed money in the housing sector in the upcoming budget by imposing only 10 per cent
tax instead of the existing 27.50 per cent tax.
The National Board of Revenue has prepared a proposal in this regard for the approval of the prime minister, said sources in NBR.
The NBR will propose that people with undisclosed money would be able to legalise their money by paying only 10 per cent value of total transaction prices of land and plots.
On the other hand, undisclosed money holders can buy residential and commercial apartments/floor space by paying an increased income tax for per square metre for apartments above 200 square metres in posh areas, they added.
The opportunity of legalising untaxed money by investing in the capital markets by paying only 10 per cent tax will continue like previous fiscal years in a bid to boost volatile stocks, they said.
Officials said finance minister Abul Maal Abdul Muhith might declare the opportunity in his budget proposal that would be placed in the parliament on June 6.
There is a general provision in the Finance Act-2012 that provides the scope for legally earned untaxed money by investing in any income generating sectors by paying 10 per cent penalty of total tax along with paying regular tax (up to 25 per cent).
NBR officials said buyers would have to declare about such investment in the income tax returns.
Earlier in 2007-08 fiscal year, the NBR provided the opportunity of legalising undisclosed money in buying land and plots by paying 7.5 per cent tax.
The NBR officials said they would propose to impose tax at the rate of Tk 5,000 for per square metre in buying apartments above 200 square metres in the posh areas such as Gulshan, Banani, Dhanmondi and Uttara while the tax would be at Tk 3,000 for other areas in the city.
The tax rate will be at Tk 4,000 for apartments below 200 square metres for these areas in the Dhaka city while the tax rate will be at Tk 2,000 for other areas in Dhaka.
Some other cities like Chittagong may also be included for the opportunity, the officials said.
Earlier in 2009-10, the government allowed investment of undisclosed money in buying apartments in the posh areas in Dhaka and Chittagong by paying Tk 800 for apartments below 100 square metres, Tk 1,000 for apartments from 100-200 square metres, Tk 1,500 for apartments above 200 square metres.
-With New Age input
