Some people are always out to use their ingenuity to design schemes for embezzling taxpayers' money through fraudulent means. The cash incentive introduced to attract more remittances through the formal channels and boost export earnings is a case in point. None knows for sure how extensive such abuses are. Indications are there that the amount of money swindled must be substantial.
The government reportedly had allocated Tk 73.50 billion for disbursement as cash incentives to exporters at varying rates during the financial year 2020-21 (FY20-21). The exporters of agro products receive the benefit at an attractive rate of 20 per cent. The incidence of forgery seems to be high in this particular area.
According to a report published in a leading vernacular daily late last week, at least 18 firms embezzled cash incentives showing 800 export consignments during the last five years. One enterprise alone got away with Tk 100 million against the export of farm goods. Investigations have revealed that the firm in question did not export any item. Further investigations are on to detect the actual amount of defalcation of the cash incentive.
There have been galore stories galore about the abuse of bonded warehouse facilities and cash incentives. But the abuse has been going on unabated for years. Customs often talks about detecting one or two such cases, but actions against the culprits are not known.
It remains a mystery as to how the swindlers manage all their papers right, receive cash incentives, and melt into thin air. In most cases, investigators find the addresses given in the export documents as fake.
No exporter is supposed to get incentives unless and until the export proceeds reach the country. These fake exporters reportedly have their men abroad who issue export orders and send money against the same. Everything is done in a planned manner to receive the cash incentive. Interestingly, many consignments do not even reach the depots meant for storing export goods. Yet the exporters concerned get proceeds against exports and cash incentives. Customs and relevant agencies have their explanations, but most are found untenable. There must be the complicity of a section of unscrupulous clearing and forwarding agents and customs officials in such fraudulence.
An exporter of a certain product has to become a member of the relevant trade body, and such an identity is used in export documents. So, it becomes the responsibility of the trade bodies to know the genuineness of the exporter/s concerned before giving him/her membership. But demanding such alertness from trade bodies appears meaningless as the top notches of one or two such trade bodies are allegedly found involved in forgery. The incumbent president of the Bangladesh Fresh Fruits, Vegetables and Allied Products Exporters' Association, allegedly, is one such individual. The irony is that the same person has received the 'commercially important card' recently for his 'significant contribution to export trade'.
It is suspected that some elements are also involved in taking 2.5 cash incentives against inward remittance. Taking funds outside the country these days is not a big deal. Such funds are again sent back home using FC accounts of expatriate Bangladeshis. It does not take too long a time to secure cash benefits against fake inward remittance.
The illegal transfer of huge funds abroad has emerged as a major problem for the country. Most of such funds, allegedly, are taken out of the country through trade invoicing. Here, businesses can hardly deny their involvement. At least, the crooks are using the trade routes for the evil purpose of money laundering. The money launders need to open letters of credit (LCs) for the export or import of goods. So, they need to have the identity of businessmen. Trade associations of all sorts do provide that. Here, the trade bodies need to exercise caution while accepting people as their members. There should be a process of scrutiny.
Cash incentive is one part of the facilities offered to exporters. The state has to count many other costs for the sake of 'boosting' exports. The government offers fiscal benefits of various sorts, including tax and duty exemptions. Taken together, cash incentives and other fiscal benefits are huge in the context of affordability.
There is no denying that the country's export earnings have recorded substantial growth. But the government needs to see whether the incentives offered over the years have paid matching dividends in terms of export revenue growth. India has recently decided to review incentives, as the export revenue growth has not been up to the desired level.
The government should not allow leakages in incentives given to exports in various forms. Culprits involved in the embezzlement of government funds cannot carry forward their evil missions without the connivance of officials manning the relevant agencies. Only close monitoring of the activities of these agencies could stop the pilferage of public funds.