BB decision to relax outward remittance rules positive: TIB
The annual revenue loss due to tax evasion in outward remittance is about 12,000 crores per year
The Bangladesh Bank's (BB) decision to allow foreigners to remit 80% of their income is positive. However, an integrated strategic policy is essential to eliminate irregularities in the recruitment of foreign workers, according to Transparency International Bangladesh (TIB).
Formulation and implementation of such a policy, with the participation of all concerned, will help prevent money laundering, TIB Executive Director Dr Iftekharuzzaman said in a statement on Wednesday.
"A large number of the foreign workers in different sectors in the country work illegally and remit their earnings through unauthorised transaction channels like hundi. As a result, the annual revenue loss due to tax evasion is about 12 thousand crores per year," Iftekharuzzaman said citing a study published by TIB on 5 February 2020.
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"However, the positive outcome from the central bank's decision can only be expected if foreign workers take the opportunity given by the Bangladesh Bank and remit their income legally," he added.
"Most of the foreign nationals do not follow the proper procedure for their employment in Bangladesh. They usually come on a tourist visa or visa on arrival or business visa, and later join various companies without following proper procedures," said the TIB executive director.
He further pointed out that since the government has not updated the minimum monthly salary limit, the employers do not even announce the correct salary of these foreigners to evade taxes. As a result, on the one hand, the government is losing a huge amount of revenue, on the other hand, an unscrupulous quarter is taking advantage of the existing system to smuggle money abroad.
The TIB recommended the formation of a joint task force comprising the National Board of Revenue, Bangladesh Investment Development Authority (BIDA), NGO Affairs Bureau and the special branches of the police to facilitate storing the data of all foreign nationals on arrival and departure, updating foreign workers' monthly income and conducting regular raids.
