REHAB for unconditional black money investment in housing sector

The country's real estate businesses called upon the authorities concerned to allow investment of undisclosed income or black money in the housing sector without raising any questions.

Speaking at the meeting with the National Board of Revenue (NBR) at its Agargaon headquarters, Real Estate and Housing Association of Bangladesh (REHAB) Administrator Zannatul Ferdous is requesting a 5-10-year window where buyers wouldn't be questioned about the origin of their funds, particularly for first-time flat purchases.

In the fiscal year 2020-21, the government introduced a scope to invest black money in all sectors, including the housing sector by paying only 10% tax. And there was a provision that, not only tax authorities, but also any other government agency would not raise any question about the source of funds.

The privilege was, however, later cancelled in the face of criticisms from various think tanks, economists, and rights activists.

Currently, there is a chance to invest undisclosed money in any sector, including housing, with a maximum 25% tax rate. Additionally, investors must pay an extra 10% tax on the initial tax amount. Any government agency can inquire about the source of the funds.

During today's pre-budget meeting, REHAB's Zannatul Ferdous said, "Without reinstatement of the option to invest black money without questions, people will launder more money. Also, rich folks are buying second homes abroad where they don't have to explain where the money came from."

She further said the government should let people invest hidden money, and then tax them later. This would boost government income.

According to REHAB, the government received Tk2,065 crore in revenue during FY21 by providing investment opportunities for undisclosed income. But later, the government has been deprived of that revenue, thanks to the cancellation of the opportunity.

Meanwhile, the REHAB also called for reducing the existing fees for flat and plot registration from 12% to 7%.

The organisation made a total of eight proposals in the pre-budget meeting for the next fiscal year.

NBR Chairman Abu Hena Md Rahmatul Muneem presided over the meeting, where representatives of various organisations from the construction sector also presented their proposals.