NBR expects last minute rush for whitening untaxed money

FE Team | Published: July 13, 2007 00:00:00 | Updated: February 01, 2018 00:00:00

Doulot Akter Mala
The National Board of Revenue (NBR) expects a last minute rush of the people to declare their undisclosed money by July 31, the deadline set for doing so by paying the tax at the normal rate, in addition to the amount of penalty, on their untaxed income.
The board has collected about Tk 112 million from undisclosed money holders until Wednesday last. The term "undisclosed money" refers to the money earned through legal means and held by the people without payment of income tax.
Talking to the FE, the NBR chairman Badiur Rahman said: "It is customary that people normally rush at the fag end of a deadline. We hope the response from the undisclosed money holders will also get momentum in the coming days."
On June 4, the government offered the opportunity to legalise undisclosed income with the payment of 5.0 per cent penalty in addition to the normal tax rate.
Asked his comment about the opportunity offered during 2004-06 for legalising money with the payment of 7.5 per cent tax, the NBR chairman reacted sharply saying: "The opportunity was totally unfair, partial and a demonstration of favouritism to a certain group of people."
He criticised the move and said such opportunity had discouraged regular taxpayers as they were paying higher tax than that of the undisclosed money holders.
"The income tax slabs are --10 per cent, 15 per cent and 25 per cent -- but the undisclosed money holders had enjoyed the opportunity to legalise the money paying only 7.5 per cent," he said.
The NBR chief termed this as 'wrong decision' of the then government, which deprived the legal taxpayers of justice.
"We are getting a slow response this time as there is a cautionary note in the statutory regulatory order (SRO) about illegally earned money," the NBR chief said.
The SRO also made it clear that individuals, who are under legal action of the government, will be barred from taking the opportunity, he said.
The offer to legalise money with the payment of 7.5 per cent tax had received a large amount revenue on account of both legally and illegally earned money as the SRO did not make any specific reference to the type of money, he added.
The NBR collected tax worth Tk 3.45 billion on about Tk 46 billion declared as undisclosed income in fiscal 2005-06.
The provision of 'legalising untaxed money' by paying a certain amount of tax was introduced in fiscal 2002-03 budget aiming at bringing in a large amount of untaxed money into the formal economy.