Payment of wealth tax registered a 22 per cent growth in the last fiscal year over the previous mark, belying a common belief that the number of wealthy people is on a rather faster rise in the country.
Some 10,931 well-off people put their wealth above board and paid the tax, known as wealth surcharge, worth Tk 2.54 billion in FY 2014-15, according to National Board of Revenue (NBR) data.
In FY 2013-14, the NBR received Tk 2.08 billion in wealth tax from 10,152 people.
An individual taxpayer having net asset above Tk 22.5 million is required to pay 10 per cent surcharge on their wealth.
In the current budget for FY 2015-16 the government has slapped a minimum amount of surcharge worth Tk 3,000 for the well-off section of people.
Business leaders, experts and former tax officials take with a grain of salt the number of wealthy people as registered in tax folios-they find the figure unusually low and guess the existence of a large black economy.
They said the number should be at least ten times higher in the present context of Bangladesh.
Talking to the FE Wednesday, Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) President Abdul Matlub Ahmad rated the number 'unusually low' and said it should be ten times greater than what is revealed.
He said high rate of tax and hassle in payment of tax discouraged many people from showing their actual wealth to the taxmen.
"There is huge number of people outside the tax net. The tax authority should bring them under purview of tax through motivation and simplification of tax system," said the apex chamber's chief.
Under the existing income tax ordinance, surcharge collection depends on price declaration by the taxpayers. Only taxpayers are paying the surcharges. Many tycoons who do not pay taxes are not under the purview of surcharge.
Dr Ahsan H Mansur, Executive Director of the Policy Research Institute (PRI), said the current collection system of tax from well-off people is 'socially inequitable' and 'unjust'.
"Under the system, existing rich people have to pay less tax than that of the neo-rich as valuation of property is being done on the purchase price of property," he said to explain the mismatch in tax calculations.
Valuation of property should be done at the current market price to collect taxes from the well-off section of people, he added.
Former income tax (policy) member Syed Aminul Karim said valuation system of property is required to collect due taxes from the opulent.
"The property valuation is being conducted on the basis of years-old purchase price. Collection of wealth tax can be raised many times by proper valuation of asset," he said.
He termed 'unscientific' the current system of wealth-tax collection.
Credit Suisse Global Wealth Report-2015 put Bangladesh in the group of countries having wealth below US$5,000 per adult. Other countries of the group include Cambodia, India, Myanmar, Nepal and Pakistan.
The report also mentioned that inhabitants of lower-income countries in Asia, such as Bangladesh, Indonesia, Pakistan and Vietnam, tend to be found lower down in the wealth distribution.
According to the latest research report of the international financial service organisation, Credit Suisse, people's wealth in Bangladesh has increased threefold in the past 15 years.
The wealth the people of Bangladesh possessed in 2000 was $78 billion, which increased to $237 billion in 2015.
Credit Suisse has identified 1.2 million Bangladeshis as members of the middle class, who are said to have wealth amounting to at least $17,886 each.
The National Board of Revenue (NBR) received Tk 1.01 billion in surcharge from the well-off people in the FY2012-13.
As per existing income tax rules, surcharge in several slabs has been levied on people having any net asset worth above Tk 22.5 million. The rates are 10 per cent up to Tk 100 million while 15 per cent for up to Tk 200 million, 20 per cent for up to Tk 300 million and 25 per cent above this mark.
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