Huge fines for finding untax assets abroad

Staff Correspondent: The Income Tax Bill-2023 has been passed in the National Parliament on Sunday, reducing the discretionary power of income tax officers to facilitate the filing of returns in order to increase revenue. The new law states that if a taxpayer fails to disclose assets held abroad in his return, and if the assets are found by the tax authorities and fails to provide a satisfactory explanation of the source of acquisition of such assets and other matters, a fine will be imposed. The concerned officer can also levy a fine equal to the fair market value of the property abroad.
The bill makes it mandatory to submit (return) of assets and returns if personal travel abroad except for medical or religious purpose at any time of the year, if the assets are more than Tk 40 lakh on the last date of the tax year.
Finance Minister AHM Mustafa Kamal proposed the bill in the National Parliament session on Sunday. Opposing the bill, opposition party Jatiya Party raised the proposal to send it to the selection committee. Fakhrul Imam, Barrister Shamim Haider Patwari, Roshan Ara Mannan, Dr. Rustam Ali Faraji, Kazi Firoz Rashid and Independent Member of Parliament Rezaul Karim Bablu. However, their proposal was rejected by voice vote. Later the bill was passed by voice vote.
The old Income Tax Ordinance had tax concessions on investments in savings bonds. The Sixth Schedule of the new Act mentions government securities under investment tax concessions but excludes savings bonds. In view of this, savings and debentures have been added to the definition of securities in the Act through amendment. Under the new law, investments in savings bonds and debentures will get tax relief.
Apart from this, the tax has been increased on the purchase of flats through black money investment in elite areas like Gulshan-Banani. In Gulshan, Banani, Baridhara, Motijheel commercial area, Dilkusha commercial area, if you buy a flat with an area of more than 200 square meters through black money investment, you will have to pay income tax of Tk 6 thousand per square meter. It was Tk 5 thousand in the proposed bill. Apart from this, the tax per square meter has been increased from Tk 700 to Tk 800 in the municipal area of the district headquarters.
Based on the recommendation of the Parliamentary Standing Committee on Finance Ministry, the conditions for submission of returns by small companies have been relaxed. Section 73 of the proposed bill said that companies, firms and individuals with a turnover of more than Tk 2 crore should submit income tax returns certified by a chartered accountant. This limit has been increased to Tk 3 crore, thereby reducing the tax compliance burden of small companies to some extent.
Also, under the old law, the NBR could often change the tax rates by notification at any time of the year. The new law stipulates that the tax rate cannot be increased by issuing a notification. As a result, traders will benefit. Participating in the discussion of the bill, Jatiya Party Member of Parliament Fakhrul Imam said that those who have more than one car will have to pay a huge amount of tax.
The law is making the opportunity to launder black money permanent. This will encourage people to earn black money. Shamim Haider Patwari, another Member of Parliament of the same party, said that those who give donations to foreigners are sending money to the country through charity by paying income tax there. If taxes are imposed there, NGOs will suffer. He alleged that NBR is being given arbitrary powers through this Act. He questioned whether the NBR has the ability to determine which is religious and which is charitable.
Kazi Firoz Rashid of Jatiya Party said that Tk 10 thousand crore will be spent to digitize the tax collection system. And it will increase tax collection by one and a half lakh crore. But it is not being done. This money is going away. He complained that no file can be processed in NBR without bribe. NBRE is a barrier to digitization. Regarding the income tax bill, Finance Minister AHM Mustafa Kamal said that this bill has been brought to ensure order in the income tax system. The bill has been discussed at various stages. Parliamentary committees have also been examined. If this bill is passed, all concerned will benefit. Revenue collection will increase.