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The effect of tax amnesty on anti-money laundering in Bangladesh

Attiya Waris (School of Law, University of Nairobi, Nairobi, Kenya)
Laila Abdul Latif (Litigation and Research Department, Rachier & Amollo Advocates, Nairobi, Kenya)

Journal of Money Laundering Control

ISSN: 1368-5201

Article publication date: 6 May 2014

3089

Abstract

Purpose

The article aims to rely on the global wealth chains theory to study the effect of tax amnesty on anti-money laundering (AML) in Bangladesh. This theory is an analytical framework intended to identify how wealth is repackaged and disguised to move it out of spheres of state oversight, regulation and taxation. It introduces the law on AML in Bangladesh, pointing out the revised Financial Action Task Force (FATF) recommendation that has expanded the scope of money laundering predicate offences to cover both indirect and direct tax crimes and smuggling in relation to customs and excise duties and taxes.

Design/methodology/approach

Interviews in Bangladesh and desk research.

Findings

There are some gaps in the scope of the offence, the coverage of predicate offences and the types of property covered by the money laundering offence. There is also an absence of financial penalties available to effectively sanction legal persons. The current money laundering offences are derived from the ordinance issued in 2008 by the caretaker government (2006-2008). The current act contains detailed definitions of money laundering and property and a list of predicate offences and sanctions for the offence. However, there are some gaps in the physical elements of the offence, and the range of its predicate offences remains too narrow. Adding tax evasion to its list of predicate offences will, given the history of money laundering in Bangladesh, aid in combating illegal transfer of assets abroad and recovery of the same and abolish tax amnesty.

Originality/value

There is no paper that has analysed the linkages between money laundering and taxation in developing countries, especially Bangladesh.

Keywords

Acknowledgements

This paper was made possible through the Go4health and STEAL projects

Citation

Waris, A. and Abdul Latif, L. (2014), "The effect of tax amnesty on anti-money laundering in Bangladesh", Journal of Money Laundering Control, Vol. 17 No. 2, pp. 243-255. https://doi.org/10.1108/JMLC-04-2013-0011

Publisher

:

Emerald Group Publishing Limited

Copyright © 2014, Emerald Group Publishing Limited

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