Last minute rush for investing undisclosed money in land, property and cars
Wednesday, 27 June 2007
Doulot Akter Mala
The National Board of Revenue (NBR) has been receiving better response from people investing undisclosed income on land, property and vehicles compared with those legalising their untaxed income through payment of penalty.
The income tax department will be able to exceed its increased target for the current fiscal as tax collection from those undisclosed money holders shot up during the last few days, sources concerned said.
But, the sources could not give specific data or volume on the amount of tax received from those people.
Undisclosed money holders are availing of the opportunity that allows people to invest in land, property and vehicles without disclosing the sources of income. The provision will cease to exist from fiscal 2007-08 beginning on July 1.
Abolition of the provision of payment of tax at a specified rate for construction of building or purchasing houses or flats or land or purchasing car, without disclosing source of money has been proposed in the budget for fiscal 2007-08.
The government recently turned down a proposal from property businessmen on continuation of the provision for another year.
The existing tax provision bars taxmen from asking the source of un-taxed money put into land, apartment and vehicle purchase.
A section of people has been taking the chance to legalise their undisclosed income through purchasing land, flats or vehicles at the fag end of the current fiscal, sources concerned said.
The undisclosed money holders prefer this option to remain out of the government's scrutiny and hide the source of income.
"We are getting huge response from tax payers despite payment of higher tax rate on purchase of houses and vehicles," a competent source said.
In fiscal 2006-07, the government imposed a higher tax rate on such purchases, sources said.
According to the finance bill 2006, tax rate was increased to 7.5 per cent from the previous 5.0 per cent at the time of buying land in the metropolitan cities with untaxed money.
Tax rates have also been increased to 10-15 per cent from 5.0-7.5 per cent on purchase of vehicles having varied engine capacity.
However, the NBR has been receiving lukewarm response for its offer on legalisation of untaxed income by paying 5.0 per cent tax in addition to normal tax rates.
Under the provision, the board received tax worth about Tk 28 million until Tuesday from the undisclosed money holders across the country. The provision will expire on July 31 next.
The National Board of Revenue (NBR) has been receiving better response from people investing undisclosed income on land, property and vehicles compared with those legalising their untaxed income through payment of penalty.
The income tax department will be able to exceed its increased target for the current fiscal as tax collection from those undisclosed money holders shot up during the last few days, sources concerned said.
But, the sources could not give specific data or volume on the amount of tax received from those people.
Undisclosed money holders are availing of the opportunity that allows people to invest in land, property and vehicles without disclosing the sources of income. The provision will cease to exist from fiscal 2007-08 beginning on July 1.
Abolition of the provision of payment of tax at a specified rate for construction of building or purchasing houses or flats or land or purchasing car, without disclosing source of money has been proposed in the budget for fiscal 2007-08.
The government recently turned down a proposal from property businessmen on continuation of the provision for another year.
The existing tax provision bars taxmen from asking the source of un-taxed money put into land, apartment and vehicle purchase.
A section of people has been taking the chance to legalise their undisclosed income through purchasing land, flats or vehicles at the fag end of the current fiscal, sources concerned said.
The undisclosed money holders prefer this option to remain out of the government's scrutiny and hide the source of income.
"We are getting huge response from tax payers despite payment of higher tax rate on purchase of houses and vehicles," a competent source said.
In fiscal 2006-07, the government imposed a higher tax rate on such purchases, sources said.
According to the finance bill 2006, tax rate was increased to 7.5 per cent from the previous 5.0 per cent at the time of buying land in the metropolitan cities with untaxed money.
Tax rates have also been increased to 10-15 per cent from 5.0-7.5 per cent on purchase of vehicles having varied engine capacity.
However, the NBR has been receiving lukewarm response for its offer on legalisation of untaxed income by paying 5.0 per cent tax in addition to normal tax rates.
Under the provision, the board received tax worth about Tk 28 million until Tuesday from the undisclosed money holders across the country. The provision will expire on July 31 next.