The tax authority will join hands with the law-enforcing agencies and investment promotion authority to find out illegal foreign residents working in the country to ensure proper tax collection from them.
National Board of Revenue's (NBR) Tax Legal and Enforcement Wing recently sent letters to Bangladesh Investment Development Authority (BIDA), Bangladesh Police and National Security Intelligence (NSI) in this regard.
It has sought minimum deputy secretary or superintendent of police (SP)-level representatives from the entities to work in a taskforce of NBR.
Talking to the FE, NBR Member (Income Tax) Md Serajul Islam said NBR will sign agreements with BIDA, Bangladesh Police and NSI to exchange data with Income Tax Wing.
"We will collect offline data from police to track the illegal foreign workers here."
NBR has also planned to procure software to analyse data of the foreigners' entrance, exit, residence country and number of visits in Bangladesh, he said.
Currently, there is no specific data on total number of foreign residents in the country.
In 2016, NBR took an initiative to prepare a database of foreign workers here to ensure proper tax collection, but it is yet to see light.
The official further said despite several efforts NBR could not find out the illegal foreign residents as per its estimation.
Income Tax Wing officials also conducted physical inspections to some 30 companies, where foreigners work.
However, the visits made little impact, as the taxmen had to inform the companies prior to their visits as per income tax law.
The tax official said the tax booths, set up in the airports and landports, also failed to bring expected results.
"We found it is harassing to halt exit of the foreign citizens in the ports because of non-payment of tax that their companies are responsible to deduct from their salaries."
BIDA issues work permit for the foreign workers, but many of the workers take tourist visa to evade tax, he also said.
Employers of the foreigners are mainly responsible for this, as they calculate the payable tax with the workers' salary, he added.
According to Income Tax Ordinance (ITO) 1984, foreign workers are required to pay 30 per cent tax on their income. There is no tax-free ceiling for the foreign taxpayers.
NBR data shows that some 14,000 foreigners pay tax in the country. But the number of foreign taxpayers should be at least 50,000 as per taxmen's estimation.
Earlier, NBR formed a taskforce comprising representatives of different agencies. However, taxmen faced difficulties to carry out field inspections with the taskforce members due to legal bar.
NBR officials said the relevant provisions of ITO have to be amended, so that other government agencies concerned can work together with Income Tax Wing for finding out the illegal foreign residents.
There is a legal provision in ITO to keep privacy of the taxpayers' information. Disclosing the taxpayers' information to other agencies is a punishable offence for the deputy commissioner of taxes (DCT).
On February 4, 2018, Home Minister Asaduzzaman Khan Kamal in the parliament said a total of 85,486 foreign nationals are working in different sectors in Bangladesh, of whom 67,853 foreigners are owners of business enterprises.
Center for Policy Dialogue (CPD) in its study found that 16 per cent of the local apparel factories employ foreign individuals.
