The National Board of Revenue (NBR) has asked the country's leading chambers and businesses for not appointing or employing illegal foreigners to avoid heavy penalty to be imposed by the taxmen.
Penalty for appointing illegal foreign workers has been incorporated in the Finance Act-2015 that came into effect from July 01, 2015.
The Income Tax wing of the board recently sent letters to the apex chamber Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), Metropolitan Chamber of Commerce and Industry (MCCI), Foreign Investors Chamber of Commerce and Industry (FICCI), Bangladesh Chamber of Industry (BCI), Bangladesh Garment Manufacturers and Exporters Association (BGMEA), Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) and Bangladesh Textile Mills Association (BTMA) with details of the new provisions of penalty.
The board also sent a letter to the executive chairman of the Board of Investment (BoI) to take necessary measures in this regard.
With the newly incorporated subsection (b), the government will impose 50 per cent additional tax or Tk 0.5 million (whichever is higher) on the persons or entities employing unauthorised foreign nationals.
Tax holiday and other tax exemption facilities will be cancelled along with prosecution and punishment of these unscrupulous entities engaged in such unlawful acts.
In his budget speech on June 04, 2015, the finance minister said despite existence of large unemployment among our eligible workforce, a huge number of foreign nationals are being employed in our country most of whom are not in tax net.
According to the Income Tax Ordinance-1984, a foreign national needs to open tax file if he or she lives in the country for three months or 90 days in a year.
They also need to present their tax clearance certificates from the NBR while crossing the immigration check posts before leaving the country.
Individual foreign workers are required to pay 30 per cent tax on their income. There is no tax-free ceiling for individual non-resident foreign taxpayers in Bangladesh.
Tax officials said foreign workers are increasing in the country but tax payment scenario is poor compared to their earnings and salaries.
Many of foreign workers evade taxes with the help of their employers as they stay on temporary basis by renewing work permits after every three months, they alleged.
Some 10,000 foreign taxpayers are paying income tax annually.
Most of the foreign nationals working in Bangladesh are from India, Pakistan, Sri Lanka and China.
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