Bangladesh News

The group of businessmen who comprised 73 percent of the beneficiaries of money whitening scope given by the last caretaker government will again get the larger slice of the cake as the government has decided to continue the provision for one year.

About 57,000 persons availed themselves of the opportunity of whitening undisclosed money during the last caretaker government’s tenure. The scope has been given again to benefit businessmen and politicians who are close to the present government but did not get the chance then as they were either in jail or absconding abroad.

However, in the face of severe criticism of the provision, the government has added some conditions at the last moment, which have caused discomfort about how much benefit can be achieved from the scope.

According to a study of the National Board of Revenue (NBR), 56,845 persons whitened Tk 9,681 crore on two occasions during the tenure of the last caretaker government.

Of them, 41,801 persons (73 percent) were businessmen who got Tk 7,776 crore whitened; 3,489 government staff (6 percent) whitened Tk 289 crore; 139 defence staff whitened Tk 18 crore; 3,851 physicians (7 percent) legalised Tk 720 crore; 4,149 private service holders (8 percent) whitened Tk 425 crore; 626 lawyers whitened Tk 66 crore and 2,796 persons under other categories whitened Tk 387 crore.

NBR sources said this was the highest amount of money whitened even after paying taxes and fines in the history of Bangladesh–prompted mainly by the caretaker government’s anti-corruption drives.

Several opportunities were given to whiten money along with paying taxes at very low rates from 1976 to 2006 and around Tk 9,000 crore was whitened during the period.

Sources said the present Awami League government bowed down to the pressure from businessmen, politicians-cum-businessmen, even a parliamentary standing committee chairman and gave the opportunity despite a clear stand against whitening black money in its election manifesto.

These influential people argued that many of them were either in jail or were hiding abroad during the caretaker government’s tenure and could not utilise the opportunity given then.

Many big businessmen also proposed that the government give them the scope and they invest in the public-private partnership projects like monorail and sky rail in Dhaka city. Many also said they would bring their money lying idle abroad and invest in the country.

But they are getting the chance to whiten undisclosed money in exchange for just 10 percent tax whereas the highest tax ceiling is 25 percent for individuals and 45 percent for companies.

Facing severe criticism, the government at the last moment amended the provision for whitening money and imposed a number of conditions.

Earlier, eight donor countries wrote a joint letter to the finance minister, objecting to the provision of giving owners of black money immunity from being questioned “under any other law”.

The government has dropped the section in the proposed law.

NBR sources said for taking the opportunity owners of undisclosed money will have to fill in a form mentioning the source of the amount and projecting how much employment will their investment create.

For investing whitened money in industries and infrastructure, the government has added some new conditions.

The provisions will not apply if “a concealment of income has been detected and proceedings under section 93 have been initiated prior to payment of tax” and if the person fails to fulfil the conditions declared by him in the prescribed form.

With the reduction of the time limit for whitening money from three years to one year, the provision now applies to founding a “company for setting up new industry” so that investors can make advance declaration about the number of industries in the first year, sources said.

For investing in the share market, the proposed law says the invested money cannot be withdrawn in two years instead of previously proposed one year.

In case of purchasing flats, the law now applies to “a single flat or apartment or any one floor of a building”.

Following addition of these conditions, those who were earlier enthusiastic about the scope have now expressed dissatisfaction. They are feeling discomfort especially at the withdrawal of the section that had given them immunity from being questioned about the source of the sum “under any other law”.

They said they may not face any problem now but may get in trouble under any other law like the terrorist financing act and anti-money laundering act when the government changes.