NBR chief denies allowing ‘black money whitening’ scheme in proposed budget

The finance minister says a survey is to be conducted to fix the “mouza rate” of land and when done, there will be no opportunities to “whiten” black money

Although the proposed budget has been criticised for including an “opportunity to whiten black money”, National Board of Revenue (NBR) Chairman Md Abdur Rahman Khan denies that this is the case.

At a post-budget press conference on Friday, he said, "There is no provision for whitening black money in this budget. I think there is a little misunderstanding."

The opportunity to legalise undisclosed income is often discussed and criticised every time it has been included in the budget. Various quarters demanded that it be removed from the budget this year.

When Finance Minister Amir Khosru Mahmud Chowdhury presented the budget proposal for the 2026-27 fiscal year in parliament on Thursday, he made no mention of such a provision.

However, the Finance Bill has kept the same provision that allegedly allows for the practice during the purchase of land, buildings, or apartments.

The issue was criticised in the budget response of the Centre for Policy Dialogue (CPD) think tank on Friday morning. Fahmida Khatun, the executive director of the research institute, said that the opportunity to whiten black money included in the budget “cannot be supported”.

The topic was then raised at the finance minister's post-budget press conference at Dhaka’s Osmani Memorial Auditorium. A journalist said, "The dark side of a good budget is black money. Could the budget have been freed from black money if this opportunity was dropped?"

NBR Chairman Khan responded that there had been a “miscommunication” about the matter.

"We made a small provision last year. Those who sell land often get the money, but the registration is done at a low price. However, his money is white."

Giving an example, he said if someone sells land for Tk 50 million and the registration mentions just Tk 10 million, the seller remains in a “great danger” with the remaining Tk 40 million.

"That is why we gave them an opportunity last year that, if he can prove the remaining Tk 40 million was part of the transaction and made through his banking channel, if he has a statement, if he can prove it, then he can show document it by paying regular tax on it and a 15 percent gain tax at that rate."

Khan said, “We did this last time, but it was from the seller’s side. This time, a similar benefit was considered for the buyer as well. In this case the buyer also gets in trouble because he bought a flat for Tk 200 million, but the registration shows it was for Tk 30 million.”

Then the Income Tax Department officials conduct raids and challenge the buyer over the Tk 200 million he spent while purchasing the property, the NBR chief said, adding that the department insists him to pay extra tax and even impose fines.

The tax officials also face hassles doing so, he said.

Highlighting a “new item” that has been added to the budget to give these people “some relief”, the NBR chairman said, “If such buyers want to declare it willingly and are capable of paying 20 percent - the regular tax and an additional 15 percent, they can do so.

“Those who already have their own money, those who have money to pay taxes and those who have white money, they don’t have to pay any tax. There is such a provision, but if there is any objection to it, I think the [officials] will consider it."

Later, Finance Minister Amir Khosru also spoke on the issue.

He said, "You all know that the mouza rate is much lower than the real value. We are working on it since we did not have much time. We had to prepare the budget within one and a half months. Although we wanted to do a lot, we could not finish it as planned.

"A committee has been formed on the issue of mouza rates and we are going to review them. We are trying to bring the mouza rates back to real values so there will not be any more opportunity to turn that black money into white."

Describing the task as “lengthy”, the minister said, “A survey has to be done across Bangladesh, based on the mouza.

“Here, there is one market price for a mouza, then another price for the actual rice cultivation area. We are going to do this survey. When it is complete and we can bring the mouza rate in line with the market rate, there will not be much opportunity to whiten black money."