VOCTA demands scraping black money whitening provision, disclosing lists

Opposing the decision of the government to keep the provision of black money whitening by paying only 15 percent taxes of the money which was not shown, the Voluntary Consumers Training and Awareness Society (VOCTA) suggested the government to scrap the provision and disclose the names of black money holders through newspapers after preparing a concrete list of such persons.

If the government takes the suggestion of the VOCTA, it would help combating black money and discourage those earn black money. Otherwise, the black money holders would be encouraged by giving such a facility to whitening the black money, VOCTA Executive Director Md. Khalilur Rahman Sajal opined while responding to a query of a journalist in a press conference organized at the National Press Club on Tuesday (June 11).

The press conference was organized to brief media about “How pro-people the proposed budget is?”. Khalilur Rahman Sajal presented the recommendations in a written speech highlighting various aspects of the budget.

In the press conference, the chairman of VOCTA, Professor Dr. Hossain Uddin Shekhar, Vice Chairman Sanwar Hossain Nowroz, Directors Mohosinul Karim Lebu, Saidul Abedin Dollar, Mizanur Rahman Talukder, Noorun Nabi and Fazlul Haque were present among others.

In the press conference, the VOCTA, an organization that has been agitating for the establishment of consumer rights for a long time in the country, has placed ten key recommendations to the government to make the FY 2024-25 budget more consumer and people-friendly.

The recommendations includes ensuring proper implementation of monetary policy and fiscal policy to control inflation and clear guidelines to reduce inflation to 6.5 percent; adding a specific outline of the government’s initiative to deal with market syndicates; adding budget proposals; reducing the government’s additional borrowing from banks to meet the budget deficit; adding a clear announcement in the budget about tough crackdown on defaulters; and increasing budget allocation for education and health sector to ensure smart citizens; and skilled manpower with values and quality of education.

It has also recommended withdrawing the increased supplementary duty on mobile phone calls and internet services, move away from the provision of whitening black money by giving15 percent tax on the amount and increase the tax-free income of individuals from Tk 3.5 lakh to Tk 4 lakh.

Khalilur Rahman Sajal said the budget of 797,000 crores for the 2024-25 FY, presented to the national parliament on June 6, has estimated a deficit of 2,51,600 crores and an income of 5,45,400 crores. The proposed budget acknowledges the problem, but lacks a mechanism or direction for a timely transition.

He said, “The VOCTA has been demanding a consumer-friendly budget with special emphasis on inflation control, employment and income growth. But the proposed budget has unbridled rise in commodity prices, increase in the number of unemployed people, decrease in people’s income, action against bank debtors, illegal money laundering, etc. Reality did not appear in the proposed budget to be given much importance to the ‘consumer’.

So, the question remains, how friendly is this budget? However, there are several positives in the proposed budget, which cannot be denied. The size of the budget has been kept down so that the pressure of inflation does not fall on the people.

Although not enough, the budget has given some hope to control the ongoing hyper-inflation. This budget has taken steps to harmonize fiscal, monetary and market-based interest rates, Sajal said, adding that the announcement of cancellation of tax-free car import facility by members of parliament is a very commendable initiative.

VOCTA feel that some of the measures taken in the budget are not enough to achieve the target of reducing inflation to 6.5 percent in the proposed budget.

According to him, the country’s food price inflation is much higher than overall inflation, about 12 percent. Production and supply should be increased to control food inflation. But the budget has no clear direction or measures to de-syndicate the market including increasing food production and supply.

The proposed budget has reduced taxes and VAT on several products. Tax at source on supply of daily commodities has been reduced by 1 percent. This will give some relief to traders, but we have doubts about how much benefit will be available at the consumer level.

People’s purchasing power is decreasing due to inflation. However, it would not be reasonable to raise additional charges for mobile phone calls and internet services. Where there should not be any supplementary duty, the reverse has been increased. It was not well thought out. Increasing the duty-tax on refrigerators, ACs used by the citizens will increase pressure on the limited income and middle class.

The facility given in the budget to whiten black money with 15 percent tax is morally and economically unacceptable. Such a system will further encourage the vicious circle of corruption. Such provision is completely unreasonable and contrary to justice. Therefore, the ‘VOCTA’ thinks that the government should withdraw from this system of making black money white by paying15 percent tax.

The allocation for the social security sector in the last fiscal year 2023-24 has been increased from Tk 1 lakh 26 thousand 272 crore to Tk 1 lakh 36 thousand 26 crore in this year’s budget. Government officials-employees’ pension, profit on savings bonds, education scholarships, stipends, free textbook printing etc. are included in this allocation. The ‘VOCTA’ feels that it is not reasonable to add the pensions and profits on savings certificates to the social security sector.

A tough crackdown on defaulters was expected in the proposed budget. But there is no mention of this in the budget. Which disappointed us. This time the allocation of education in the budget is disappointing. Compared to the last time, 6 thousand crore rupees have been allocated to the education sector, but it has decreased in proportion to the GDP. Education sector did not get due importance in the budget. Whereas UNESCO advises that 5 to 6 percent of a country’s total GDP should be spent on education.