Black money to boost investment, defends Muhith

Muhith defends money whitening scope

Finance Minister AMA Muhith speaks a post-budget briefing in the capital on Friday. Photo: Amran Hossain/The Daily Star

Defending the money whitening scheme, the finance minister has said it will bring a huge amount of undisclosed money to the economy through investment.

Speaking at a post-budget press conference on Friday, AMA Muhith said the scope will also prevent siphoning of money.

He said the size of the undisclosed money in the economy is huge – ranging between 42 and 82 percent of the country’s gross domestic product (GDP).

“We have given scope to bring the undisclosed money to the market because we want the money to be invested in the economy. We want to utilise the money.”

“We have not kept the scope for investment as a condition for whitening the undisclosed money. We will include it before the budget gets passed,” Muhith told the news conference held at the Osmani Memorial Auditorium in Dhaka.

According to the budget proposals for fiscal 2012-13, individuals can whiten their black money at a cost of 10 percent tax as fine.

However, individuals have to pay regular tax plus the 10 percent fine, said the finance minister, dispelling confusions that one would have to pay only 10 percent tax to legalise money.

Nasiruddin Ahmed, chairman of National Board of Revenue (NBR), said the government had given scope for whitening the black money in the outgoing fiscal year in the stockmarket.

“None has availed the scope so far,” he said. “The scope expires in 15 July this year.”

However, a number of days are still left in the outgoing fiscal year and Ahmed hoped that people holding undisclosed money would come forward and legalise their money in the remaining days.