New black money window not total amnesty scheme: CBDT

"World over, this type of compliance window is given to taxpayers. It is a normal phenomenon all over the world. It's not that we have not been able to reach them that this compliance window has been given," says CBDT Chairman Atulesh Jindal Source: PTI
shutterstock_249994597-650 Black money The CBDT boss said the new scheme cannot be called a "total amnesty" opportunity as it is for a "limited period" of time and declarants will stand to pay penalty and surcharge on the tax evaded
  The new one-time compliance window for domestic black money holders is not a 'total amnesty' scheme, the Central Board of Direct Taxes (CBDT) said on Tuesday, making it clear that declarations under it will enjoy immunity from prosecution except under the anti-corruption law, the anti-narcotics act and a few other legislations. Describing the rationale behind announcing the new scheme in the Budget to get black funds taxed, CBDT Chairman Atulesh Jindal said the idea is "to cover those cases which have remained undetected so far" and thereby giving a chance to such people to come clean while also paying taxes with surcharge and penalty. The CBDT boss said the new scheme cannot be called a "total amnesty" opportunity as it is for a "limited period" of time and declarants will stand to pay penalty and surcharge on the tax evaded. "World over, this type of compliance window is given to taxpayers. It is a normal phenomenon all over the world. It's not that we have not been able to reach them that this compliance window has been given," Jindal told PTI. The CBDT boss assured declarants under this window, expected to go operational from June 1 for four months, will enjoy immunity from prosecution from all laws except the Prevention of Corruption Act and those mentioned in the Finance Bill. "The detailed procedures and other things will be rolled out in the future, like we did during the earlier time (overseas black money compliance window)," he said. Jindal added the information obtained by the taxman through this window will be strictly kept 'confidential' like that was done during the one-time compliance window which was activated by the government last year for overseas stash holders. "It's an opportunity given to taxpayers. Certain category of taxpayers have been excluded like where department has already issued notices or where search or seizure has taken place or where we already have information from abroad and all... these cases have been excluded," he said describing the modalities of the new window. The scheme entails a declarant to come clean by paying 30% tax plus a penalty of 7.5% and a similar percentage of surcharge. He added the government has not announced this scheme keeping in mind "any targets" like the last such scheme that was enacted in 2015 after the introduction of the new anti- black money law... Elaborating on the proposal, Finance Minister Arun Jaitley had said, "Inequality arises in amnesty, where under certain exemptions, you as a honest tax payer has paid 30 per cent and I come and join after 20 years and say that I would also pay 30 per cent." Amnesty, he said, is that like the 1996 VDIS and the present scheme is not structured that way. "This is not structured that way. You pay 30% tax and 7.5% and another 7.5%, which is 45%, ending up paying one-and-a-half times more. "So you are paying penalties for not paying tax on time. This is intending to bring some money from outside the system to into the system," the minister had said. A total of Rs.4,147 crore of undeclared wealth was declared during the 90-day foreign black money compliance window ending September 30, 2015. At 60% tax (30% tax and 30% penalty), the government got a net Rs.2,500 crore from the declarations.

 

March  01, 2016 | 06:04pm IST.

The Dollar Business Bureau - Mar 01, 2016 12:39 IST
 
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