Is it good to allow Black Money to be whiten by investing in Stock?

[Obito]

~snip

I agree these points, to some extent. It is true that money laundering mostly results from corruption and other illegal activities (including crime). When the government is announcing amnesty, in effect it is making sure that the perpetrators of these crimes will be never brought to justice. But at some point of time, a balance needs to be made. The crimes were committed many years ago. If the amnesty is not there, then the funds will remain stuck, or they will flow out of the country. There are two benefits from the amnesty - the government will receive a large fraction of the funds as penalty, and the removing amount will be injected back in to the legal economy.  

I don't think that what you're trying to say is going to be a good thing because that basically says that time is on the side of the perpetrators. No balance is needed to be made, crime is crime no matter how much you look at it and it should be specially served when the perpetrators are the elite class of the society.

[SquallLeonhart]

It is true that money laundering mostly results from corruption and other illegal activities (including crime). When the government is announcing amnesty, in effect it is making sure that the perpetrators of these crimes will be never brought to justice. But at some point of time, a balance needs to be made. The crimes were committed many years ago. If the amnesty is not there, then the funds will remain stuck, or they will flow out of the country. There are two benefits from the amnesty - the government will receive a large fraction of the funds as penalty, and the removing amount will be injected back in to the legal economy. 

That is the case about finances in the crime world, the government wants their piece and without that you are basically doing something illegal by going against the government, but when you are giving them a choice to take your money then your crimes become "white crimes" as well.

Just to give an example the amount of salary that should be paid to people for working outside of their legal time comes down to about 50+ billion dollars a year, so collectively business all over the world make people work 50+ billion dollars worth extra time without pay, does that get a penalty? Absolutely not, because those companies pay their taxes and bribe their politicians.

Same goes for drug dealers and mafia as well, pay the politicians their bribes, and launder your money however you want without worrying about anything. This means either do none of it, or do all of it because allowing one but disallowing the other makes no sense.

[sarmrakib]

Recently, I have read an update of the budget of Bangladesh where a bill of increasing (25% now) the rate for whitening black money has been passed. According to that, one can whiten their black money by investing in stock market and they have to pay 25% fee to the government. Before this year, the rate was 10%.
Is it healthy for the economy? May be it’s healthy but it’s encouraging corruption. Is there any other country which allows such investment too?
Learn more- https://www.thedailystar.net/business/economy/stock/news/tax-raised-25-investment-black-money-stocks-2120645

I also have found the news somewhere that Bangladesh govt. are giving the chance to make the black money into white money .I think it could be some beneficial for the economic strength but ultimately its encouraging the corruption .The people who earned a lot black money they are now become happy and they will continue such as work again .So that i think its not a good decision at all to give the chance to the people who are corrupted .

[Vishnu.Reang]

That is the case about finances in the crime world, the government wants their piece and without that you are basically doing something illegal by going against the government, but when you are giving them a choice to take your money then your crimes become "white crimes" as well.

Just to give an example the amount of salary that should be paid to people for working outside of their legal time comes down to about 50+ billion dollars a year, so collectively business all over the world make people work 50+ billion dollars worth extra time without pay, does that get a penalty? Absolutely not, because those companies pay their taxes and bribe their politicians.

Same goes for drug dealers and mafia as well, pay the politicians their bribes, and launder your money however you want without worrying about anything. This means either do none of it, or do all of it because allowing one but disallowing the other makes no sense.

Being a resident of India, I need to say that when the government announced the amnesty program a few years ago, the largest volumes of unaccounted money was reported from some of the individuals who are regarded as proxies of known politicians. Some of the news papers reported that more than 50% of the converted funds were owned (either directly or indirectly) by the politicians. I agree with your point as well. Legalizing one form of crime and banning another form doesn't make sense. But in general, it has been claimed that these sort of amnesties encourage more crime and corruption.

[jostorres]

Being a resident of India, I need to say that when the government announced the amnesty program a few years ago, the largest volumes of unaccounted money was reported from some of the individuals who are regarded as proxies of known politicians. Some of the news papers reported that more than 50% of the converted funds were owned (either directly or indirectly) by the politicians. I agree with your point as well. Legalizing one form of crime and banning another form doesn't make sense. But in general, it has been claimed that these sort of amnesties encourage more crime and corruption.

That might be indeed correct! In most of the Asian countries the most corrupt people are the leader themselves and in order to cover their corrupt actions they usually adjust various policies and this 25% deal might be another one of those.

If the government was really concerned about people not paying taxes and wanted to change it, it would have been a better option to force higher penalties on those who are evading tax by any means. By giving them the benefit of the doubt and allowing them to convert their black money to white is questionable, to say the least. Whatever the reason might be, this kind of approach towards wrongdoers is not something you want to see from a growing nation. Such moves can pull the whole economy down.

[Fortify]

whitening black money

These sort of phrases should be phased out if we want to see a more equal and freer world around us, subtle written biases like this are understandable but we should all make efforts to think about the connotations of our words. The term is money laundering and the government is looking to run an amnesty against such illegitimate funds. It can be a good start to eliminating corruption and raising funds, however you need to figure out how those funds were gained in the first place to stop it reoccurring. Unfortunately I have a feeling that a large portion of the beneficiaries maybe politicians or civil servants who have been raising money through favors. It is a very tricky subject to face, because in many circumstances these people should be in jail for essentially stealing from every citizen around them, but that is also expensive by itself 

[tygeade]

Recently, I have read an update of the budget of Bangladesh where a bill of increasing (25% now) the rate for whitening black money has been passed.

I am glad they increased the rate because such practices are shady and never helping the economy at all. I mean someone can scam others and even get his money to whiten/legit by paying a small sum of money? That's horrendous I think. I understand the government wants people to pay taxes and maybe pay their taxes properly from the next cycle but this opens the door for people who earned their money illegally as well.

According to that, one can whiten their black money by investing in stock market and they have to pay 25% fee to the government. Before this year, the rate was 10%.
Is it healthy for the economy?

I know you are Bangladeshi and it feels bad to say but I think your government is only thinking about taxes right now. How does this helps the economy is beyond my understanding from whatever little knowledge I have about how economies grow.

Some problems I directly see are:

1- More people will evade taxes now and if caught can always pay the 25% and get away. 10% was even more criminal because it's like encouraging people to avoid paying taxes.

2- Theft will certainly increase because people know how to get their money to whiten.

[TimeTeller]

Recently, I have read an update of the budget of Bangladesh where a bill of increasing (25% now) the rate for whitening black money has been passed.

I am glad they increased the rate because such practices are shady and never helping the economy at all. I mean someone can scam others and even get his money to whiten/legit by paying a small sum of money? That's horrendous I think. I understand the government wants people to pay taxes and maybe pay their taxes properly from the next cycle but this opens the door for people who earned their money illegally as well.

According to that, one can whiten their black money by investing in stock market and they have to pay 25% fee to the government. Before this year, the rate was 10%.
Is it healthy for the economy?

I know you are Bangladeshi and it feels bad to say but I think your government is only thinking about taxes right now. How does this helps the economy is beyond my understanding from whatever little knowledge I have about how economies grow.

Some problems I directly see are:

1- More people will evade taxes now and if caught can always pay the 25% and get away. 10% was even more criminal because it's like encouraging people to avoid paying taxes.

2- Theft will certainly increase because people know how to get their money to whiten.

That is the repercussion of this law. If they just allow black money to whiten by paying about 1/4 of its value, then, more and more people will just use this route to whiten their ill-gotten money.
However, maybe the government just think of this method to at least get something from this ill-gotten wealth rather than not getting any of it.
Also, they can get the record of those people who will submit their docs and who will avail this service. So they have idea who are these people who are getting black money.
A lot of people are already evading tax so just get certain percentage of it is already good for the government.
But do you think these people will expose themselves and just pay the 25% fee? I believe some will not abide this new protocol and just keep the money within themselves and find how to stash it on their own.

[justdimin]

Of course it has a bad impact, laundering the money successfully means that the lives that was harmed or taken making those money will not see justice because the money got cleaned with all it's blood like no one was hurt. Laundering is never a good thing because it makes life unfair because they don't pay their dues to the community through taxes and fighting to survive fairly.

It encourages such practices and just because the governing bodies are money-minded the rate of crime will go upwards. It is similar to handing over guns to criminals and assuring them to get their money into their banks for a percentage of it. This means people who were paying taxes honestly and on time were fools.

I also have found the news somewhere that Bangladesh govt. are giving the chance to make the black money into white money .I think it could be some beneficial for the economic strength but ultimately its encouraging the corruption .The people who earned a lot black money they are now become happy and they will continue such as work again .So that i think its not a good decision at all to give the chance to the people who are corrupted .

It doesn't contribute to economic growth at all and I agree with you that it only gives rise to more criminalistic activities because the governing bodies are supporting them.

Maybe some kind of a notice that this is a one-time leverage/advantage given to the citizens in order to correct their mistakes and will not be sanctioned in the future would have done much better to the economy.

[wxa7115]

It sounds like a legalized money laundering scheme by a corrupt government. However, this scheme is well-known tax amnesty type

Bangladesh is not the first country to bring such an amnesty scheme. A few years back, there was a successful amnesty scheme in India, which brought billions of USD to the treasury. But one drawback is that criminals may use this opportunity to legalize the funds they earned through illegal means - such as robbery, ransom, corruption.etc. The government knows that at least some of the funds may be of dubious origin. But when they are desperate for funds, they just ignore these hard facts.

And this is my problem with this, if we were talking about just about those that have avoided to pay their taxes but that still owned a legal business and they just engaged on a scheme to save themselves on taxes then that is one thing.

However it seems they are going to allow this amnesty to apply to all funds regardless of where they come from, which means criminals could use the opportunity to legalize their funds that way and this is never a good thing.

[TheGreatPython]

Recently, I have read an update of the budget of Bangladesh where a bill of increasing (25% now) the rate for whitening black money has been passed. According to that, one can whiten their black money by investing in stock market and they have to pay 25% fee to the government. Before this year, the rate was 10%.
Is it healthy for the economy? May be it’s healthy but it’s encouraging corruption. Is there any other country which allows such investment too?
Learn more- https://www.thedailystar.net/business/economy/stock/news/tax-raised-25-investment-black-money-stocks-2120645

Lol I have seen or heard of a thing like this. For me it is totally wrong, and it shouldn’t be allowed in any country. Any government that allows such laws in their country is trying to encourage corruption on their country.

Imagine countries where government officials are embezzling money and then using this means of paying tax to whiten it lol. That’s not good, such rules must have been set by a corrupt government so as to escape the consequences of the actions that they take. It’s nothing new that all these government are so corrupt and any single opportunity they see, they use to steal from the country’s wallet. So setting rules like this means that they are trying to encourage such things.

[Little Mouse]

Learn more- https://www.thedailystar.net/business/economy/stock/news/tax-raised-25-investment-black-money-stocks-2120645

Lol I have seen or heard of a thing like this. For me it is totally wrong, and it shouldn’t be allowed in any country. Any government that allows such laws in their country is trying to encourage corruption on their country.

In the last fiscal year, huge money was whiten by this corrupted people. I had a closer look after reading this news. This is ridiculous that an honest businessman has to pay far higher amount as tax than a corrupted man who has whitened the black money last year.
Still, after increasing the rate, it’s low than some of the business corporate taxes.
Few businessman have already raised their voice against this and they were also mentioning about encouraging corruption by govt.

[Kong Hey Pakboy]

No, I don't think that in any way it's going to be a good thing because if you think about it, laundered money is an unfair money, a lot of people are paying their taxes and you just get in the stock market and throw in your dirty money in there with no taxes being paid. I don't know what came to the mind of the people who proposed this law but I am sure that that person or politician isn't worthy of any vote in the next election.

[bryant.coleman]

No, I don't think that in any way it's going to be a good thing because if you think about it, laundered money is an unfair money, a lot of people are paying their taxes and you just get in the stock market and throw in your dirty money in there with no taxes being paid. I don't know what came to the mind of the people who proposed this law but I am sure that that person or politician isn't worthy of any vote in the next election.

Depends on the situation. The problem with taxes is that they affect only the middle class. The rich use numerous loopholes to avoid paying taxes. And they have most of their assets in tax havens such as the island nations in the Caribbean. Now if the government gives these rich people an option to invest the money in their own country, instead of carrying it to Antigua or Dominica, who is going to benefit from such a measure? You can claim that it may increase future cases of tax evasion. But it is up to the authorities to prevent future cases. Here we are talking about funds that has been laundered already.

[evilgreed]

Recently, I have read an update of the budget of Bangladesh where a bill of increasing (25% now) the rate for whitening black money has been passed. According to that, one can whiten their black money by investing in stock market and they have to pay 25% fee to the government. Before this year, the rate was 10%.
Is it healthy for the economy? May be it’s healthy but it’s encouraging corruption. Is there any other country which allows such investment too?
Learn more- https://www.thedailystar.net/business/economy/stock/news/tax-raised-25-investment-black-money-stocks-2120645

               I'm not absolutely sure if it's just me or is it that a lot don't get what black money is? Or maybe it refers to illegal money? If it does indeed refer to illegal money then 25% is till too low specially when we think about how taxes help the overall situation of a country. And besides, this shouldn't even be allowed to begin with so I don't quite see anything wrong with the tax rate. Rather, it may even be very beneficial from both sides with the government being at the losing end. At least though, there is something to gain from these black money that can help the country grow.

[wxa7115]

Lol I have seen or heard of a thing like this. For me it is totally wrong, and it shouldn’t be allowed in any country. Any government that allows such laws in their country is trying to encourage corruption on their country.

Imagine countries where government officials are embezzling money and then using this means of paying tax to whiten it lol. That’s not good, such rules must have been set by a corrupt government so as to escape the consequences of the actions that they take. It’s nothing new that all these government are so corrupt and any single opportunity they see, they use to steal from the country’s wallet. So setting rules like this means that they are trying to encourage such things.

I have not thought about it but this is entirely possible, which just show us how corrupt governments can be, it is possible they do not even care about the taxes they will receive out of this and instead this is just a way to justify what they have been stealing.

But if they opened this opportunity only to themselves then it would be too obvious what they are doing and as such they decided to open this opportunity to everyone else in order to hide the fact they are doing this just to make the money they stole legal and to be able to spend it without having to hide the source of it.