The Real Estate and Housing Association of Bangladesh (Rehab) has urged the government to incorporate a provision in the upcoming budget for 2013-14 fiscal, allowing legally earned undisclosed money to purchase flats and apartments using.
The association had submitted a set of recommendations to the finance ministry, including one for re-enactment of the now-defunct law on investment of undisclosed money, commonly termed as black money, that it wants reflected in the budget announcement in June, a Rehab official said.
He said the association’s President Nasrul Hamid Bipu, MP, General Secretary Engineer Anisuzzaman Bhuiyan Rana and other top leaders also met with the state minister for law Qamrul Islam late last month, requesting him to provide legal support in the re-enactment process.
Rehab argues that buyers should be allowed to buy their first flats without the obligation to reveal their sources of income, for at least the next 5-10 years, considering the “existing situation in the real estate sector.”
Meanwhile, Transparency International Bangladesh (TIB) countered the demand of the housing association, terming it “illogical” and “completely contradictory to the constitution.”
Dr Iftekharuzzaman, executive director of the Bangladesh chapter of the global graft watchdog, told the Dhaka Tribune, “Thiskind ofdemand should not be entertained in any way by the government, since doing so would send a wrong signal and encourage earning of black money and corruption.”
“It would be unfortunate and against the constitution if the government accepts their illegal demand. Any sort of compromise with money from non-credited sources would make the sector further dependent on people having them and discourage honest traders.”
TIB’s concern was consistent with many financial experts, who have raised concerns about the government’s probable move to allow whitening of black money and its investment in share market and such sectors.
Iftekharuzzaman said there are no avenues through which the government can consider the option to accept Rehab’s suggestion.
Rehab, in its recommendation, also urged the finance minister to reduce levies related to flats and plots from the existing 12.5% to 4.5%, and also introduce Tax Holiday system in different metropolitan areas, including Dhaka district, cantonment areas and regions outside the union parishads to “encourage urbanisation.”
It further recommended that a fund amounting to Tk15bn be set up by the government to provide housing loans to aspirant customers so that they can buy flats in Dhaka and outside.
Defending the recommendation for a no-strings-attached permission to invest undisclosed money, Rehab General Secretary Engr Rana said such a move would “help stop money from being laundered in Canada, Malaysia and Singapore.”
“We do not understand why TIB doesn’t understand this,” he said.
Observing that TIB is an organisation analysing only “certain aspects” of the constitution, he said, “It is not fair to think that things in Bangladesh will work like they do in developed countries like Germany.”
Bangladesh has been losing momentum because of the illogical arguments of a few international organisations like TIB, he added.
