Govt mulling bringing payment of house rents under banking channel

The government is thinking of bringing the payment of house rents under the banking channel with a view to bringing both the house owners and the tenants under the tax net. The National Board of Revenue (NBR) in a recent survey found that both the house owners and the tenants ‘usually evade tax’. The NBR thinks that if the payment of rents by tenants to house owners is done through banking channel it would be easier for the tax collectors to identify the eligible taxpayers. NBR chairman Ghulam Hossain first hinted about the matter at a pre-budget discussion at his office in Dhaka on April 30. NBR sources said there might be a disclosure regarding this in the next national budget. The NBR chair during his recent visit to Chittagong for attending two pre-budget business meetings with the directors of Chittagong Chamber of Commerce and Industry (CCCI) and Chittagong Metropolitan Chamber of Commerce and Industry (CMCCI) said thousands of millions of taka were being transacted in the real estate sector every year. But the tenants allege that the owners were not paying due taxes to the government. The tenants were also dodging taxes, NBR chairman said in Chittagong. According to data provided by the Real Estate and Housing Association of Bangladesh (Rehab), realtors have handed over around 164,000 flats to their buyers since 1992. The NBR has started collecting apartment owners’ payment information from the realtors in a bid to identify the tax-dodger flat owners in major cities. In December 2012, the revenue collecting authority had launched a survey targeting homeowners and landlords in metropolitan cities, and shops in markets and malls, aiming to bring 300,000 new people under tax net. The initiative came as the revenue authority believes that a large number of people remain out of the tax net despite having taxable incomes. The NBR chair at a consultative meeting of NBR and FBCCI on May 8, said the revenue collection target for next fiscal year will largely depend on income tax considering its enormous untapped potentiality, according to UNB.