Anyone can validate the undisclosed income at any time by paying tax and penalty at specified rates. Despite this provision, various governments have given the opportunity to turn black money into white. The outgoing Awami League government has given the same opportunity in the current fiscal year 2024-25 under the condition of paying 15 percent tax. But the maximum tax rate for legitimate taxpayers is 25 percent. Before the passing of the budget, there was a lot of criticism in this regard as well as the demand to cancel this opportunity, but it was not heeded.
Recently, Sheikh Hasina’s government fell due to anti-discrimination student movement. The interim government took charge of the country. The main demands of the student movement are elimination of discrimination, reform of the state and ensuring justice. Therefore, experts say that allowing black money to be white is against the constitution. And now that there is a student government, it has become necessary to abolish this black law.
Former member of the National Board of Revenue (NBR) (Customs and Excise). Farid Uddin told Vanik Barta, “Whitening black money is against the constitution, against fundamental principles and completely against the students’ anti-discrimination and state reform movement.” If this government of the students continues, it will be unfair to the main demands of the students’ movement. Because it is inconsistent with their movement.’
According to the budget of the current financial year, black money can be legalized or whited without question by paying a tax of 15 percent. Similarly, by buying land, flats, apartments, there is an opportunity to launder money by paying taxes at specific rates depending on the area. In that case tax will have to be paid at fixed rate per square meter.
Zahid Hossain, the former chief economist of the World Bank Dhaka office, also called for the cancellation of the opportunity to whiten black money, which has been criticized. Recently, through a post on his wall on the social media Facebook, he drew the attention of Finance Advisor Salehuddin Ahmed in this regard. Zahid Hossain said, ‘The opportunity to turn black money into white should be canceled in this fiscal year’s budget. Reinstatement of this facility for a limited period (three to six months) by adding a penalty of 5-10 percent to the maximum income tax may be considered.’
Analysts alleged that dishonest tax payers are being rewarded through this black money laundering law. And injustice has been done to honest taxpayers.
Former Director General (Legal and Prosecution) of ACC, Moidul Islam, said to Banik Barta that giving the opportunity to whiten black money in the budget is unconstitutional, “Article 20 of the Constitution states that no one can enjoy unearned income.” By doing this, one cannot succeed against corruption. Zero tolerance against corruption is halal if 15 percent tax on corrupt assets is halal! It is a two-pronged policy. It will encourage illegal income. Those who earn illegal income will be protected. And if the government takes a 15 percent tax, why can’t the question be asked? You have to know the source.’
The Metropolitan Chamber of Commerce and Industry Dhaka (MCCI) expressed concern after the budget for allowing black money to become white. As a result of this system, the regular tax payers will be discouraged, this association of traders said. The opportunity to whiten black money is a punishment for regular tax payers, they claim. Regular tax payers will be encouraged if this system is introduced by introducing the provision of penalty along with imposition of maximum rate of tax through actual practice.
Former NBR Member (Tax Survey and Inspection) Ranjan Kumar Bhowmick told Vanik Barta, ‘The opportunity to whiten black money is contradictory. The year the opportunity to bring back the smuggled money was given, there was no response. Those who want to show undisclosed income, will show at regular tax rate. Pay a fine. That is enough. That is good.’
According to NBR sources, as of January 2023, about 47 thousand crores of undisclosed money has been laundered in the country. Ziaur Rahman and Ershad lost only Tk 95 crore in 15 years. In the last three terms of Awami League (2009-2023), about 33 thousand crores of taka have been white. In the fiscal year 2020-21, the highest ever Tk 20,600 crore is white.
Earlier, during the caretaker government of 2006-07, an anti-corruption task force was formed along with providing opportunity to whiten black money. A list of suspected corrupt persons was released. At that time, about 32 thousand taxpayers whitewashed 11 thousand 107 crore taka. A lot of people take the opportunity out of fear.
The former chairman of NBR. Mohammad Abdul Majeed said to Banik Barta, ‘It is important to keep the issue of legalizing undisclosed money in regular law. Accordingly one shall pay tax at the regular rate by showing his undisclosed income and shall pay a penalty of 10 per cent.’