The government has been deprived of a huge amount of revenue due to tax exemptions for businesses close to the deposed dictator Sheikh Hasina, who was ousted in the anti-discrimination student movement. During Sheikh Hasina’s 16-year rule, the National Board of Revenue (NBR) granted tax exemptions to business groups close to the then government by issuing special notifications or SROs. This deprives the state exchequer of real revenue income.
This information has emerged in the report of the white paper preparation committee on the investigation of irregularities and corruption during the Awami League-led government and the economic situation of Bangladesh. This report was submitted to the chief advisor of the interim government, Professor Muhammad Yunus, on December 1.
Chief Advisor Dr. Muhammad Yunus, the prominent economist in assessing the current situation of the economy and investigating the irregularities and corruption of the last 16 years. Devapriya Bhattacharya announced the formation of the white paper drafting committee. The committee submits its report to the head of government within 90 days.
A member of the white paper drafting committee, Professor Mohammad Abu Yusuf of Dhaka University told Bass that the amount of tax exemption during the previous regime was 6 percent of the country’s total GDP. Halving it would have doubled the education budget and tripled the health budget.
According to the report, since 2009, the Awami League government had to issue SROs at different times on the orders of the Ministry of Finance, through which businessmen close to the government get tax exemptions in most cases. These privileged businessmen were either affiliated with the ruling political party or close to high level bureaucrats.
It further states, “Overuse of SROs (Tax Waiver Facility) during Sheikh Hasina’s tenure has become a tool to gain political advantage, which has weakened the effectiveness of Bangladesh’s tax policy.”
Tax waivers through SROs have weakened the country’s tax base and encouraged corruption, the White Paper identified.
“Often ad hoc changes in tax laws through SROs have been inconsistent with transparency and predictability, disrupting the normal course of business and reducing revenue collection,” it said.
The report also said that several business groups like Beximco, S Alam, Summit regularly availed this facility.
According to the report, the Summit Group has fully accounted for its LNG terminal operations in 2018 on project income, income of foreigners, royalties, technical know-how fees and technical assistance fees, capital gains from transfer of shares and interest on foreign loans in terms of maintaining accounts and filing income tax returns. Get tax exemption.
The group also got full tax exemption on 15 power projects, income of foreigners within three years of arrival in Bangladesh, interest on foreign loans, royalties, technical know-how and assistance fees and capital gains from transfer of shares.
Similarly, other companies have enjoyed tax exemptions in various forms. However, the white paper report did not mention the specific amount of money received from this tax exemption.
It is to be noted that the Chief Adviser accepted the white paper report on December 1 and mentioned that it is a historical document. He also talked about including the white paper report in the agenda to learn from it.
Chief Adviser Professor Yunus said in his speech on Victory Day last December 16, “The people of the country have been shocked after reading the white paper report. Everyone understood that the fascist regime had destroyed the country’s economy. But the extent to which the economy has been reduced to rubble is beyond measure. The White Paper Drafting Committee has calculated and calculated the amount.
Source: Bass
