Pay 50% Tax, Lock 25% for 4 years on your unaccounted money

karthikandsunil

The Finance Minister today introduce a bill in Parliament to  amend Income Tax Act, providing window to black money hoarders proposing to tax 50% tax, penalty and surcharge of 50% on the amount deposited on the amount deposited post demonetization, while higher taxes and stiffer penalty of up to 85% await those who don’t disclose but are caught.

The bill  also provides for black money declarants a mandatory depositing of 25% of the amount disclosed in anti-poverty scheme without interest and a four-year lock-in period.

Those who choose to declare their ill-gotten wealth stashed till now in banned 500 and 1,000 rupee notes under the Pradhan Mantri Garib Kalyan Yojana 2016, will have to pay a tax at the rate of 30% of the undisclosed income. Additionally, a 10% penalty will be levied on the undisclosed income and surcharge called PMGK Cess at the rate of 33% of tax (33% of 30%).

Further, the declarants have to deposit 25% of the undisclosed income in a scheme to be notified by the government in consultation with the Reserve Bank of India (RBI).

For those who continue to hold onto undisclosed cash and are caught, existing provisions of the Income Tax law will be amended to provide for a flat 60% tax plus a surcharge of 25% of tax (15%), which will amount a levy of 75%.

Besides, if the assessing officer decides he can charge a 10% penalty in addition to the 75% tax

The disclosures in PMGKY scheme will ensure that no questions will be asked about the source of fund. It would ensure immunity from wealth tax, civil laws and other taxation laws. But there is no immunity from FEMA, PMLA, Narcotics, and black money act.

Deposits which have been already made from November 10 will be covered under PMGKY. “Last date we will notify after the bill is passed but it is likely to be December 30. PMGKY will come in as a new Chapter 9 in Finance Act 2016.

Source: Business Standard/Mathrubhumi

Pay 50% Tax, Lock 25% for 4 years on your unaccounted money

One thought on “Pay 50% Tax, Lock 25% for 4 years on your unaccounted money”

Leave a comment