National Budget 2024-25
Scope of whitening black money 'unconstitutional, corruption-friendly': TIB
Transparency International Bangladesh (TIB) has expressed shock and disappointment over the 'unethical' provision in the newly announced budget that allows the whitening of black money disguised as undisclosed income.
The anti-graft watchdog feared that the facility to legalise black money with just a 15 per cent tax would discourage honest and legitimate taxpayers, as no authority would question the money and assets declared under this provision, it said in a press release on Thursday.
This will foster a liberal environment conducive to corruption in the country. Furthermore, this opportunity undermines the ruling party's election manifesto and its frequently reiterated pledge of zero tolerance against corruption.
In light of these concerns, TIB strongly demanded the withdrawal of this provision.
TIB executive director Iftekharuzzaman expressed frustration over the logic behind keeping the provision to whiten black money.
He also expressed profound disappointment at how the Data Verification System (DVS) has resulted in legal complexities regarding the declaration of undisclosed money, leading to the legitimization of property purchases using such funds, primarily due to taxpayers' lack of awareness. Even more troubling is that no authority will have the opportunity to question these transactions.
He also said, “Justifying such unethical, illegal, discriminatory and unconstitutional provision which renders the ruling party’s talk against corruption meaningless is also deepening and widening the erosion of moral and ethical backbone of the society. Furthermore, it is a clear government invitation to the people to be involved in all forms of corruption and illegitimate enrichment with the guarantee that such black money will be given clean certificates. In other words, government is, in reality, advising people to be corrupt with a guarantee of impunity.”
Iftekharuzzaman termed the provision of a maximum 30 per cent tax on honest taxpayers as discriminatory and unconstitutional:“For a number of reasons this provision is unjustifiable. It is distinctly contradictory to the Constitution, especially article 20(2) which criminalizes illegitimate income.
It further violates the constitution as it is discriminatory against honest income earners who are subjected to upto 30 per cent tax whereas the black money holders are being practically rewarded for corruption by offering the bait of only 15 per cent.”
“Compromising morals in an attempt to collect expected revenue will never succeed in the short or long term. A prime example is that two years ago, a 10 per cent tax was allowed to legalize undisclosed money, but there was no significant response. Similarly, no one took advantage of the opportunity to repatriate smuggled money. Therefore, it is reasonable to question whose interests are being served by including such provisions in the budget,” he added.
Calling upon the government to end the long-standing and unconstitutional practice of providing opportunities to whiten black money, Iftekharuzzaman hoped that “The government will ultimately act with good sense, foresight, loyalty to the Constitution, and adherence to the rule of law by withdrawing this provision. Simultaneously, we call for effective accountability measures to trace the sources of wealth of black money owners, thereby reducing rampant corruption.”