THE government moves to increase holding tax in Dhaka and Chittagong cities by up to nine times at a time seems to be highly arbitrary that lacks reasonable justification anyway to be acceptable to the both city dwellers. People are voicing angry reaction to such move and we must say it is quite natural. Under the newly proposed holding tax some estimate suggests owner of a house in the city may be required to pay up to Tk 72,000 from Tk 8,000 now as tax on a holding.
It clearly seems to be a mocking with the affordability of house owners who will invariably increase house rent to pass the financial load on rentiers. It will seriously hit the people already suffering from high house rent and cost of living.
It is not unusual for City Corporations may hike holding tax, but such a big rise at one go suggests they have almost become insane only calculating the exorbitant rise in revenue – no matter how it is going to impact the house owners. House owners have obligations to pay more as the cost of improving city infrastructure is going up. But there must be a reasonable rise and the best thing is that there must be a mechanism of exchange of views to motivate house owners to pay higher holding tax.
What is noticeable, even some lawmakers of the ruling party have joined common people to protest the move – however not so much for lacking money to pay higher holding tax but for its negative impact on voters at a time in the run up to the next Parliamentary Election later next year. They have seriously criticized the move in parliament on Thursday questioning the manifold rise in a go; which has the potential to earn the ire of voters. It is not time for such move they told the concerned authorities asking to stop it at the moment.
We must say the holding tax has many flaws and it is not unknown to city officials and at higher circles of the Revenue Administration. Most house owners conceal the lion part of their house rent as they take it in cash. They just partially report income in their tax returns and continuing to deceive the Revenue Authorities. We believe the government may frame stringent holding tax rules and strengthen watchdog activities on tax offices to plug the loopholes instead of multiplying the tax rate. This may raise the revenue from households by many times instead of raising the holding tax many times. A 16-storied building with as many flats may yield several times revenue than a fixed rate, though highly exorbitant it may be on a holding. Many believe the concerned authorities are tactfully avoiding the issue.
Corruption and irregularities are high in the household tax collection like any other segment of tax administration causing loss of huge amount of money every year that needs to be seriously dealt with. The best thing for the government is to spread the tax incidence based on income a house owner receives from house rent.
It clearly seems to be a mocking with the affordability of house owners who will invariably increase house rent to pass the financial load on rentiers. It will seriously hit the people already suffering from high house rent and cost of living.
It is not unusual for City Corporations may hike holding tax, but such a big rise at one go suggests they have almost become insane only calculating the exorbitant rise in revenue – no matter how it is going to impact the house owners. House owners have obligations to pay more as the cost of improving city infrastructure is going up. But there must be a reasonable rise and the best thing is that there must be a mechanism of exchange of views to motivate house owners to pay higher holding tax.
What is noticeable, even some lawmakers of the ruling party have joined common people to protest the move – however not so much for lacking money to pay higher holding tax but for its negative impact on voters at a time in the run up to the next Parliamentary Election later next year. They have seriously criticized the move in parliament on Thursday questioning the manifold rise in a go; which has the potential to earn the ire of voters. It is not time for such move they told the concerned authorities asking to stop it at the moment.
We must say the holding tax has many flaws and it is not unknown to city officials and at higher circles of the Revenue Administration. Most house owners conceal the lion part of their house rent as they take it in cash. They just partially report income in their tax returns and continuing to deceive the Revenue Authorities. We believe the government may frame stringent holding tax rules and strengthen watchdog activities on tax offices to plug the loopholes instead of multiplying the tax rate. This may raise the revenue from households by many times instead of raising the holding tax many times. A 16-storied building with as many flats may yield several times revenue than a fixed rate, though highly exorbitant it may be on a holding. Many believe the concerned authorities are tactfully avoiding the issue.
Corruption and irregularities are high in the household tax collection like any other segment of tax administration causing loss of huge amount of money every year that needs to be seriously dealt with. The best thing for the government is to spread the tax incidence based on income a house owner receives from house rent.
