Black money in stocks to continue, will be taxed much more
Skip to main content
  • Home
  • Economy
  • Stocks
  • Analysis
  • World+Biz
  • Sports
  • Features
  • Epaper
  • More
    • Subscribe
    • COVID-19
    • Bangladesh
    • Splash
    • Videos
    • Games
    • Long Read
    • Infograph
    • Interviews
    • Offbeat
    • Thoughts
    • Podcast
    • Quiz
    • Tech
    • Archive
    • Trial By Trivia
    • Magazine
    • Supplement
  • বাংলা
The Business Standard

Sunday
August 07, 2022

Sign In
Subscribe
  • Home
  • Economy
  • Stocks
  • Analysis
  • World+Biz
  • Sports
  • Features
  • Epaper
  • More
    • Subscribe
    • COVID-19
    • Bangladesh
    • Splash
    • Videos
    • Games
    • Long Read
    • Infograph
    • Interviews
    • Offbeat
    • Thoughts
    • Podcast
    • Quiz
    • Tech
    • Archive
    • Trial By Trivia
    • Magazine
    • Supplement
  • বাংলা
SUNDAY, AUGUST 07, 2022
Black money in stocks to continue, will be taxed much more

Stocks

TBS Report
29 June, 2021, 09:25 pm
Last modified: 29 June, 2021, 11:04 pm

Related News

  • Offshore tax amnesty not an opportunity to bring black money: NBR chairman
  • Wall St Week Ahead: Inflation data may seal fate of unloved US stock rally
  • Asian stocks rise on upbeat data, Fed hawks lift dollar
  • Shares rally as markets bet on more gradual rate hikes
  • DSEX hits 14-month low as panic continues

Black money in stocks to continue, will be taxed much more

Market people have welcomed the move with some unfavourable opinions

TBS Report
29 June, 2021, 09:25 pm
Last modified: 29 June, 2021, 11:04 pm
Black money in stocks to continue, will be taxed much more

The government has finally allowed the whitening of undisclosed money by investing in stocks and other listed securities for the second consecutive fiscal year.

Market people have welcomed the move with some unfavourable opinions as tax for the whitening process has been more than doubled.

"We appreciate the decision to continue the option, but the new conditions will not be effective in drawing black money into the stock market," said Rakibur Rahman, a veteran stockbroker and a member of the Dhaka Stock Exchange's board of directors.

In the 2020-21 fiscal year, the government allowed undisclosed money in the stock market on condition of paying a flat 10% tax on the total amount while regular income tax goes as high as 25%.

This time, the government made the whitening tax a flat 25% on the total and also imposed a new 5% penalty on the total tax amount.

Together, they raised the effective cost of black money whitening through investments to 26.25% from the previous 10%.

This would not work to secure the inflow of undisclosed money in the capital market, said Rakibur.  

"Keeping in mind the poor response over the previous fiscal year, I can say the opportunity will not be grabbed by enough people as they will have to pay much more tax on the total money to be whitened," he added.

The chance given last year was poorly accepted by wealthy people as over the first 11 months of the fiscal year, less than Tk500 crore was whitened by 334 taxpayers.

Most importantly, Rakibur said, all the points that had made the capital market less competitive as an asset class to attract black money are still there.

Like the previous fiscal year, owners of undisclosed money can whiten theirs through bank deposits, savings schemes, real estates, and also merely disclosing cash without investing anywhere.

Whitening tax against each of the options other than real estate was raised similarly this year.

"Why should one buy listed securities with a compulsion to hold it for a year while the lock-in is not applicable in other cases?" Rakibur asked.

The opportunity to whiten black money has long been a debated issue as most experts argue that it discourages honest taxpayers, and lower than regular tax on whitening is an injustice to them.

But the opposite opinion gained momentum too, especially among those who care more about the outcome than principles, as the country is seeing siphoning of funds overseas.

The government during the budget proposal a month ago avoided the topic and later changed mind, responding to some industry recommendations. 

Top News

black money / stocks

Comments

While most comments will be posted if they are on-topic and not abusive, moderation decisions are subjective. Published comments are readers’ own views and The Business Standard does not endorse any of the readers’ comments.

Top Stories

  • Hitting the highway.Photographer: David Paul Morris/Bloomberg
    US drivers are using less gasoline. Let's keep it that way
  • File Photo: State Minister for Power, Energy and Mineral Resources Nasrul Hamid
    All factories to remain closed once a week under rationing system
  • 15 students hurt after police charge baton on protest over fuel price hike
    15 students hurt after police charge baton on protest over fuel price hike

MOST VIEWED

  • Dutch-Bangla Bank receives ‘AAA’ credit rating
    Dutch-Bangla Bank receives ‘AAA’ credit rating
  • City Bank perpetual bond’s half-yearly coupon rate declared at 9.58%
    City Bank perpetual bond’s half-yearly coupon rate declared at 9.58%
  • Himadri Limited asked to offload 10% more shares
    Himadri Limited asked to offload 10% more shares
  • Rangamati Food Products: Revival of a food processor
    Rangamati Food Products: Revival of a food processor
  • Capital market prepares to facilitate startups
    Capital market prepares to facilitate startups
  • A Wall Street sign outside the New York Stock Exchange in New York City, New York, U.S., October 2, 2020. REUTERS/Carlo Allegri
    Wall St Week Ahead: Inflation data may seal fate of unloved US stock rally

Related News

  • Offshore tax amnesty not an opportunity to bring black money: NBR chairman
  • Wall St Week Ahead: Inflation data may seal fate of unloved US stock rally
  • Asian stocks rise on upbeat data, Fed hawks lift dollar
  • Shares rally as markets bet on more gradual rate hikes
  • DSEX hits 14-month low as panic continues

Features

Safa Shareef’s bridal make-up: Contemporary with a ‘deshi’ touch

Safa Shareef’s bridal make-up: Contemporary with a ‘deshi’ touch

9h | Mode
Infograph: TBS

Why a drastic fuel price hike is dangerous

1d | Panorama
A fuel price hike to fuel agony

A fuel price hike to fuel agony

1d | Panorama
Kamal Uddin Mazumder. Sketch: TBS

Rising foreign debt and balance of payments deficit: Does Bangladesh need to worry?

1d | Thoughts

More Videos from TBS

Is BPC really in loss?

Is BPC really in loss?

59m | Videos
Reasons behind Putin-Erdogan's meeting in Sochi

Reasons behind Putin-Erdogan's meeting in Sochi

5h | Videos
Dr Jamaluddin Ahmed talks about recent fuel price hike

Dr Jamaluddin Ahmed talks about recent fuel price hike

5h | Videos
Temperature rises in Sundarbans, water crisis deepens

Temperature rises in Sundarbans, water crisis deepens

9h | Videos

Most Read

1
Diesel price hiked by Tk34 per litre, Octane by Tk46
Energy

Diesel price hiked by Tk34 per litre, Octane by Tk46

2
July remittance hits two-year high
Economy

July remittance hits two-year high

3
5,400 Bangladeshis get work visas to Romania
Migration

5,400 Bangladeshis get work visas to Romania

4
Housing projects sprouting up by Dhaka-Mawa expressway
Real Estate

Housing projects sprouting up by Dhaka-Mawa expressway

5
How banks made millions from volatile dollar 
Banking

How banks made millions from volatile dollar 

6
Infographic: TBS
Banking

Dollar rate will be left to market after two months: Governor

EMAIL US
contact@tbsnews.net
FOLLOW US
WHATSAPP
+880 1847416158
The Business Standard
  • About Us
  • Contact us
  • Sitemap
  • Privacy Policy
  • Comment Policy
Copyright © 2022
The Business Standard All rights reserved
Technical Partner: RSI Lab

Contact Us

The Business Standard

Main Office -4/A, Eskaton Garden, Dhaka- 1000

Phone: +8801847 416158 - 59

Send Opinion articles to - oped.tbs@gmail.com

For advertisement- sales@tbsnews.net