The income-tax department on Thursday nudged black money holders to make "honest" disclosures under the tax amnesty scheme -- Pradhan Mantri Garib Kalyan Yojana -- warning that non-declaration could attract 77.25 per cent tax and penalty along with prosecution.
CAs not sure if individuals declaring unaccounted money will get immunity from reassessment as these provisions are not covered in the Bill.
Rs 6,000-cr disclosure just four days before scheme ends
Under the PMGKY scheme, black money holders can deposit unaccounted cash in account which will be subject to 50 per cent tax and 4-year interest free lock-in for the remaining 25 per cent of the amount
Limited IT staff may compel them to focus on big fish than small depositors.
Not declaring the black money under the scheme now, but showing it as income in the tax return form would lead to a total levy of 77.25 per cent in taxes and penalty. In case the disclosure is not made either using the scheme or in return, a further 10 per cent penalty on tax will be levied followed by prosecution.
The Income Tax department has begun the process to examine bank deposits and transactions to check possible black money instances and said once the last opportunity to declare funds in old notes under the PMGKY scheme ends it will be very tough for hoarders.
The PMGKY will not allow declarants to use claims made for refunds for advance taxes paid, tax deducted at source and tax collected under the scheme.
Nearly three weeks after Prime Minister Narendra Modi announced junking high denomination 500 and 1000 rupee notes, Finance Minister Arun Jaitley introduced a bill to amend the income tax law.
Adjusted for inflation, the earlier scheme would have collected Rs 25,000 crore.
"The response (to the PMGKY) has not been so good...about Rs 5,000 crore of income was declared in PMGKY," Revenue Secretary Hasmukh Adhia said.
The I-T Department had identified 1.8 million taxpayers in its Operation Clean through data mining and asked them to submit responses about the source of their deposits.
Such a move will help bring clarity to the Centre's estimates of the demonetised amount
Under 'Operation Clean Money', the I-T department had sent SMS and e-mails to 18 lakh people
The income tax department on Friday warned against indulging in cash transaction of Rs 2 lakh or more, saying that the receiver of the amount will have to cough up an equal amount as penalty.
The department said that total confidentiality is ensured to those who declare their black assets and funds
The Central Board for Direct Taxes on Friday said a black money declarant under the PMGKY scheme will be allowed to file declarations under the stipulated Form 1 by April 10, if tax and penalty is paid by the deadline that ends on March 31 (Friday).
This amount is just about 10% of the previous IDS
Kumar said the Commission will follow the time-tested methods of consultations and consensus building in bringing about any reforms and will not shy away from tough decisions, according to an Election Commission (EC) statement.
The disclosures will enjoy immunity from wealth tax, civil and other taxation laws but there will be no immunity from FEMA, PMLA, narcotics and black money laws.
The I-T department will rely on data analytical tools and run models to separate black money holders and genuine taxpayers based on the large data base being shared by banks.
The official twists and turns have raised questions on the government's credibility and its ability to pull the nation out of the demonetisation quagmire. To keep up with the new rules, the government has issued an updated FAQ on demonetisation.
Tax wing scanning cash deposits between Rs 5-10 lakh
I-T heat on thousands of firms for unusual cash deposits.
Available evidence suggests that we are on the way to a very costly failure of the current demonetisation scheme, says M R Narayana.
'We have not issued notices randomly.' 'We have done the risk profiling of individuals, and sent to those whose profile has not matched with their declared income.'
Reacting sharply to the Global Hunger Report 2021, the Women and Child Development Ministry said it is 'shocking' to find that it has lowered the rank of India on the basis of FAO estimate on proportion of undernourished population which is found to be 'devoid of ground reality and facts, and suffers from serious methodological issues'.
While the central bank had publicly cited only Rs 15.55 trillion of high value notes were cancelled, in an RTI reply to PTI, it had said the actual quantum of bills cancelled was much higher at Rs 20.51 trillion.
'Like doctors, health workers, police, bankers are also COVID warriors,' notes Tamal Bandyopadhyay.
Against estimates of black wealth of Rs 300 lakh crore and black money in cash of Rs 3 lakh crore by economist Arun Kumar, the PMGKY numbers fall short by a huge margin.
Demonetisation should be judged to have delivered some immediate gain if at least around Rs 2 trillion gets immobilised.
The economy could return to 8% growth by the end of 2017-2018, says Arvind Panagariya, vice-chairman NITI Aayog.
Measures may include tax slab and rate revisions for individuals, companies.
Whether it was the MGNREGS or the NFSA or the Aadhaar-based DBT scheme for cash transfer, the Modi government has built on the basic architecture created by the Singh government. Policy makers in the Modi government, instead of discarding them as products of the previous political regime, worked on them, expanded their scope and reach, and used new tools to improve their performance, explains A K Bhattacharya.
A combination of reduced cash intensity, a focused strategy of tax administration and GST is the way to go, say Sakshi Gupta, Tanvi Garg and Abheek Barua.
While some CMs suggested reopening economic activity in phases, others pitched for the extension of the coronavirus lockdown, but with a carefully crafted exit strategy
'Their vote bank has shifted to the BJP; the Congress is yet to realise it.'
The patience, discipline, and resolve displayed by 125 crore Indians, will play a critical role in shaping the future of the nation for years to come, the PM said.
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