Union cabinet on Tuesday approved a stringent legislation to curb black money and illegal wealth stashed abroad. The bill will be introduced in the current session of Parliament.
As per the cabinet note accessed the provisions of the bill are as under:
— concealment of income and assets and evasion of tax in relation to foreign assets will invite a rigorous punishment of ten years. The offence has also been made non-compoundable. Further, the offenders will not be permitted to approach the settlement commission. The penalty for such concealment of income and assets will be at the rate of 300 per cent of tax. Normally, the maximum additions are 100 per cent.
— non-filing of returns or filing of returns in adequate disclosure of foreign assets will invite a rigorous punishment of seven years.
— Further, the undisclosed foreign income will also be taxable at the maximum marginal rate with no exemptions or reductions.
— Those having foreign assets will be mandatorily required to file return even if there is no taxable income.
— Not only individuals but entities, banks, financial institutions have all been covered under this law.
— Those opening foreign accounts would be mandatorily required to disclose it before income tax authorities.
— Beside this new law, these offences will also be made punishable under the existing prevention of money laundering act. This will enable enforcement agencies to attach and confiscate assets held abroad and launch prosecution against the person and entities.
In his budget speech this year, finance minister Arun Jaitley had said the government will come out with a new law to effectively deal with the black money stashed abroad. He said a “comprehensive new law to track black money” would be framed. The law will contain provisions for 10 years’ rigorous imprisonment
Bringing back black money stashed abroad has been a key promise of the Narendra Modi government and its first Cabinet decision was to announce the setting up of a SIT to probe black money cases. In its first decision after taking charge, Prime Minister Narendra Modi’s government had announced the formation of a Special Investigation Team (SIT) to probe black money.