Reinstate amnesty for black money in real estate: FBCCI

The Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) today demanded the reinstatement of unquestioned amnesty for black money in the real estate sector for the next 5 to 10 years to reduce capital flight.

It is needed to continue allowing the investment of black money in purchase of flats, plots, commercial buildings and shopping malls without any question, the apex trade body said.

If the opportunity of investment is given again in those sectors, a lot of money of the country will remain inside the national border and the national wealth will grow, it added.

If the section of income tax ordinance in this regard is not reinstated immediately, there is a possibility of capital flight and it will continue to grow, according to budget proposals of the FBCCI.

Moreover, a lot of money has been going out of the country as many are buying second homes abroad where the source of the money is not asked, the federation said.

The FBCCI presented the budget documents at the 43rd budget consultative meeting jointly organised by the National Board of Revenue (NBR) and the FBCCI held at the Sonargaon Hotel in Dhaka.

The government in 2020-21 fiscal year provided opportunity to legalise black money through investment in real estate and apartment without raising any question about the sources of income on payment of certain amount of taxes, depending on the size and location of the properties.

The demand for reinstatement of the option for black money investment in the real estate sector draws criticism from different quarters.

A total of 11,859 taxpayers legalised their black money last fiscal year by paying Tk 2,064 crore in tax in the fiscal year 2020-21, according to the NBR data.

And save for land and flat valuation, about Tk 17,230 crore was whitened during that fiscal year. Some 4,514 land and flat owners whitened their assets by paying a tax of Tk 343 crore, showed NBR data.

The amnesty to legalise illegally earned wealth without question was curtailed the following 2021-22 fiscal year and the NBR imposed rules that the taxpayers will have to pay 25 per cent tax on the undisclosed amount of money and pay a 5 per cent penalty on the payable taxes.

In the current fiscal year, the NBR maintained a special tax treatment for investment in building and apartment without keeping the provision of unquestioned amnesty.