The New Nation - Internet Edition

Staff Reporter

The government yesterday allowed legalising of undeclared legal income with penal tax of 7.0 per cent on top of the normal tax rate.

The legalisation of undeclared income has been allowed for the first four months from July to October of the fiscal year 2008-09.

Finance Adviser Dr AB Mirza Azizul Islam in his budget speech allowed declaration of undeclared legal income of individual tax-payers to expand revenue base.

Economists believe that hundreds of billions of Taka remains in the informal chain and could not contribute to the economy as the taxpayers did not disclose those due to various reason.

Last year the caretaker government offered the opportunity of legalising undeclared income for four months from June to September. Last year people had to pay a penal tax of 5.0 per cent plus normal tax rate under the opportunity.

Only Tk 52.13 billion worth undeclared income was 'legalised' last year from which the government earned an extra tax of Tk 8.02 billion.