Taxpayers will be able to whiten their black money by paying a 15% tax, according to a provision proposed in the FY24-25 budget.
The Finance Minister announced this initiative during his budget speech in Parliament on Thursday.
Under this provision, no authority can raise questions if a taxpayer pays tax at fixed rates for immovable properties like flats, apartments, and land, and a 15% tax on other resources including cash, irrespective of the existing laws of the country.
The minister said in this budget speech, “I propose to add a clause on tax incentives in the Income Tax Act to provide taxpayers with an opportunity to correct errors in their income tax returns and to increase the flow of money into the mainstream economy."
He said, “We need to provide more revenue to enable sufficient public spending while also keeping economic activity dynamic in the private sector.”
The minister also pointed out that the introduction of the Data Verification System (DVS) has led to legal complications in disclosing undisclosed income and assets of various companies. Additionally, taxpayers may inadvertently make errors in their returns, possibly due to ignorance.
To address these issues, he said, the proposed clause will allow taxpayers to rectify such errors.
Finance Minister Abul Hassan Mahmood Ali placed a Tk 7,96,900 crore budget for the fiscal year 2024-25 at the Parliament on Thursday (6 June).
The proposed budget is 4.6% larger than the current one and much lower than the year-on-year average increase of 11% seen in the last 5 years.
During the peak of the coronavirus pandemic, which brought the economy to a near halt amid worldwide lockdowns, the national budgets grew by around 9%. The budget for FY2023-24 has been 12.35% larger than the previous year's.
Prolonged economic crisis, driven by both external and internal factors has forced the government into a tight fiscal position.
Bangladesh saw a 5.82% growth in the gross domestic product (GDP) in FY2023-24.
Under such circumstances, the government's prime target is to contain inflation, resolve the dollar crunch and achieve moderate GDP growth.
The country has been grappling with an average inflation of 9.73% in the first 11 months of the current financial, and then there is one of the worst dollar shortages in recent times.
In the proposed national budget, the economic growth target for the upcoming fiscal year has been set at 6.75% - lower than the 7% of the outgoing fiscal year.
At the same time, the government has set an inflation target of 6.5%.
The proposed budget has a deficit of Tk 2,57,000 crore. The government has plans to get foreign loans and grant allocations of Tk1,00,000 crore; domestic borrowing will cover the rest of Tk1,57,000 crore.
Bank borrowing target for FY2024-25 has been set as Tk 1,32,000 crore.
The highest expenditure is for interest payments at Tk1,29,000 crore in the proposed budget.
With an 8% increase compared to the current one, revenue collection has been set at a target of Tk 5,40,000 crore for FY2024-25.
For the first time, funding for the Annual Development Programme (ADP) has been reduced amid an austere stance in the proposed budget.
This is the first budget of the fourth consecutive term of the government led by the Awami League after winning the 12th National Parliament following the 7 January
