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Wednesday, January 25, 2006

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EDITORIAL
 
Taxing owners of dirty money
1/25/2006
 

          THE government leaders often come down heavily on the people in general for their apathy towards paying taxes. Though there is no excuse for dodging taxes by any citizen of a civilised nation, it is usually the people belonging to the low and middle income group who become the butt of criticism of the government leaders and the tax people as having the propensity to evade taxes. Conversely, it is always the people of limited means who are law abiding and the real taxpayers to the government's exchequer. The tax people show little sympathy to these sections of society when it comes to assessing their taxes.
There are innumerable instances that they have been chased, harassed and forced to pay disproportionate amount of taxes as well as penalties for little or no lapses on their part. The revenue collectors appear to be too active and uncompromising in the delivery of their duties towards the government in these cases. Regrettably, an opposite picture dominates the scene when it comes to the case of tax evasion by the rich. The tax collectors, more often than not, prove to be very lenient towards the very rich, many of whom are possessors of ill-gotten money, for reasons best known to the former. This is an open secret and it is not that the man in the street does not know why this discriminatory attitude prevails in the tax administration towards the common taxpayer vis-à-vis the rich ones.
But one cannot also hold the taxmen responsible only for this attitude. In fact, the government and many of its laws are themselves rather soft towards the very wealthy, a large number of whom have been found to be the worst tax evaders in society. Apart from the various legal loopholes through which the big fishes evade the tax net, there are various types of provisions made by the government itself with the hope that the owners of the untaxed wealth may invest their money in productive enterprises. Though there is no correct statistics on how many possessors of unearned wealth have already invested their money for such good causes using these provisions, various quarters are having a field day by taking advantage of this legal provision. Reports have it that during the last two months only the holders of black money have whitened a huge amount of wealth valued at Tk 500 million. Oddly though, a large number of these people holding black money have Tax Identification Numbers (TINs) which they use to slip through the tax net cast by the National Board of Revenue (NBR). As you would expect, the owners of black money so blessed with TINs have not given a damn about submitting their income tax returns by the 31st October last as instructed by the NBR. The upshot of it all is that the government is being deprived of a large amount of revenue in the process. Should one then blame these tax evaders thus using the legal loopholes to go scot free at the expense of the government's generosity towards the owners of illegal money?
Experts and professionals on tax laws cannot also be blamed if they help such holders of unearned money to get away with a token payment in the form of tax against the wealth they have been amassing through crime, smuggling and all other forms of illegal means. Of late, the practice of whitening black money, thanks to the generous legal provisions, is so rampant that it causes to raise few eyebrows. During about these three decades and a half of our existence as an independent nation, such generous provision was extended on six occasions to the holders of black money with the result that so far an amount of Tk. 36.95 billion has been whitened. But compared to the size of the black money the amount whitened during that period was very insignificant. However, it is still a matter of wild guess if that amount, too, had gone to develop the economy.

 

 
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