Proposal to use 'undisclosed' money in real estate rejected

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

FE Report
Finance and planning adviser Mirza Azizul Islam has turned down a proposal on continuation for another year of the provision that allows people to invest in land, property and vehicles without disclosing the sources of income.
The adviser rejected outright such demand when the leaders of the country's leading property businessmen met him Tuesday for a post-budget discussion.
"There is no scope for a compromise on the issue," the finance and planning adviser told reporters after the meeting.
Abolition of a provision of payment of tax at a specified rate for construction of building or buying houses or flats or land or purchasing car, without disclosing source of money is one of the proposals made in the new budget.
"This is not a budgetary issueâ€¦..it's a moral issue," he added.
Businessmen under the banner of Real Estate and Housing Association of Bangladesh (REHAB) have also requested the finance and planning adviser to introduce an alternative to such fiscal incentive.
REHAB president MA Awal told reporters that they agreed with the logic of moral issue involved in the offer of such incentive that encourages corruption.
"But we have suggested an alternative to the previous incentive so that the development of the country's real estate sector does not face major roadblocks," he added.
Azizul Islam, however, did not pay much heed to such proposal saying that there was no scope for any alternative measure either.
He, however, offered some solace to the REHAB leaders by assuring them to consider some other demands such as tariff readjustment of construction materials.
Apart from the continuation of the income tax provision 90(3) for another year, the REHAB has proposed for fixing the registration charge at five per cent to help establish transparency and generate government income.
It urged the government to withdraw existing ban on cement import and reduce the proposed import tariff and other duties on import of the building material.
The REHAB also pleaded the government for cancellation of the proposed duty rise on construction materials in the new budget to curb the price hike of such materials in the local market.
Besides, demand for long-term credit at lower interest rate and introduction of cash incentive equal to foreign currency earned by the sector through selling of property to overseas Bangladeshis.
The REHAB president said the real estate business has been mostly sluggish since the beginning of the anti-corruption drive by the present caretaker government.
The business has, however, picked up a little bit, he said adding that the real estate businessmen want active consideration of their demands by the government to restore vibrancy of the sector.
REHAB claims the sector contributes 15 per cent to the country's gross domestic product (GDP) a year and helps generate employment of about 1.5 million people.
The contribution to the GDP will be about 20 per cent by the real estate sector if the shares of its related fields are considered, it said.