Aliens evade Tk 12,000 cr annually
Md Joynal Abedin Khan: The National Board of Revenue (NBR) has taken special surveillance on some 1,55,000 foreigners from India, followed by China, Japan, South Korea, Malaysia, Pakistan, Sri Lanka, Taiwan, England, USA and South Africa as they are tactfully dodging huge amount of tax from their earnings.
Only 95,000 alien workers out of 2,50,000 are paying tax regularly as per the country’s prevailing rules and regulations.
Besides, to evade taxes, the salaries of legal foreign workers are shown less in the official documents than their real income, NBR sources said.
The workers from so far 44 countries are involved with 21 professional sectors, including teaching, business and construction works and earned huge money and sending money to the respective countries by dodging taxes, they said.
The foreigners illegally work in various organizations, mostly in readymade garment (RMG) sector and they did not use proper banking channel to send money to their countries. Rather they use hundi, an illegal means of fund transfer, they added.
The Income Tax Wing of NBR has decided to resume its door-to-door survey from this month in a bid to tackle tax evasion and expand tax net, said a senior tax official.
Taxmen will visit households, shops, business outlets, service providing entities and other potential sources as possible tax payers (national and foreigners) do not get escape for tax dodging, he said.
However, the NBR has taken especial watch on foreigners as they have been passing huge amount of money through illegal channel to dodge the tax officials, according to him.
The Income Tax Wing also directed its officials to reconstitute door-to-door survey teams. Each of the tax zones will have four survey teams, comprising 10 members each, he added.
To stop income tax dodging by the foreigners, a new section has also been added to the Income Tax Ordinance in 2015-16 under, which one will be jailed for three months to three years and be penalised Tk 500,000 or both if he/she appoints any foreigner national without prior permission of the authorities concerned. The companies will also lose tax holiday or exemption benefits.
All the foreigners are bound to pay 30 per cent tax on their income if they stay and work in the country for 90 days a year.
On February 5 this year, Transparency International Bangladesh (TIB) showed in a report, the foreigners working in the country are taking away Tk 26,400 crore every year illegally from Bangladesh. Thus, they evade taxes amounting to Tk 12,000 crore every year. At least 2.5 lakh foreigners from 44 countries are working in 21 sectors in the country. Of them, only 9,500 are paying tax regularly. They don’t use proper banking channel to send money to their countries. Rather they use hundi, an illegal means of fund transfer, according to the TIB report.
It mentioned that bout 1,60,000 foreign nationals entered to the country on a three-month tourist visa and manage jobs soon afterwards given the shortage of people with strong communication and management skills, which are in high demand in the garment sector that has gone on to become the world’s second largest supplier of apparel. Their salaries are paid fully in cash or to bank accounts abroad, depriving the government of the due taxes.
Earlier, Home Minister Asaduzzaman Khan has said that some 85,486 foreign nationals of 44 countries are engaged in various types of jobs legally but the NBR authorities believe the actual number of the foreign nationals engaged in jobs in the country will be four to five times higher of the.
Of the recorded foreigners– 67,853 are businessmen, 8,300 experts, 3,682 officials, 2,105 players and sports organisers, 922 capital investors, 804 personal staff, 727 technical professionals, 561 NGO workers, 400 research or training staff and 132 are house assistants. But some 35,386 Indians are involved in various types of jobs in Bangladesh which is highest from a single country.
“Checking tax evasion and avoidance, reviewing tax exemption with implementing reforms in tax management and adopting other tough technics to realise outstanding taxes could be a good strategy for the NBR to minimise its gap in revenue target and collection, according to experts,” said Professor Dr Rashed Al Mahmud Titumir of Dhaka University’s Development Studies.
He put emphasis on checking tax evasion and tax avoidance as undocumented foreign nationals will not get chance tax dodging from their real income.
To evade taxes, the salaries of legal foreign workers are shown less in the official documents than their actual income, he added.
These undocumented workers are working in a handful of organisations. So, it is easy to find them out, he further said.
He also mentioned that the foreigners working here legally or illegally have to pay tax at the flat rate of 30 percent. “NBR could try to get money from this pocket at first.
The Anti-Corruption Commission (ACC) Chairman Iqbal Mahmud has said that the commission is working to identity the foreigner workers who are evading taxes.
“Actions are not being taken against the tax-evading foreign workers by the concerned authorities, though there is proper legal ground to do so,” he said.