'The black money problem is a problem confined to few individuals'.
Refusing to relent on the pursuit of black money, Finance Minister Arun Jaitley today said the government will not "go soft" on bringing unaccounted wealth back into the formal system.
"This (black money) is not an issue which we are going to go soft on. Because, ultimately the target of any economy as it grows is to bring more and more resources into the system," he said at 'The India Summit 2015' organised by The Economist magazine.
The black money problem, Jaitley said, "is a problem confined to few individuals".
"We were reasonable enough to put people on notice and gave them a fair opportunity to bring them in. . . I can only tell that those who disagree on black money issue, well we will agree to differ," he said.
Jaitley said he had representations from people requesting him to ‘go easy’ on domestic black money.
"I must tell you with great sense of discomfort that I have delegations coming to me saying even on domestic black money please go easy, because this is at least adding to economic activity.
“Now no economy can indefinitely sustain an argument of this kind," he said.
The government has from July 1, 2015 enacted the Blackmoney (Undisclosed Foreign Income and Assets) and Imposition of Tax Act to deal with foreign black money.
The Act provides for tax and penalty of 120 per cent and jail term of up to 10 years for holding undisclosed foreign assets.
It also provided a 90-day compliance window to escape the harsh punishment by declaring the assets and paying 60 per cent tax and penalty.
As far as dealing with domestic black money is concerned, the government has already introduced the Benami Transactions (Prohibition) (Amendment) Bill, 2015, in the Lok Sabha and it is currently being scrutinised by the Standing Committee.
It provides for attachment and confiscation of benami properties and also fine with imprisonment.
Jaitley said: "India needs all its resources to come within the system. Ultimately the expansion of our banking system, the Payments Banks, other scheme which we are still considering the pipeline, will try and bring all these resources into the banking system."
The government has already issued two sets to Frequently Answered Questions to clarify doubts of stakeholders regarding the foreign black money law.
The 90-day compliance window to declare overseas wealth ends on September 30.
No compounding of cases falling under new Act: Cases of Indians holding funds stashed abroad and falling under the purview of the new anti-black money law will not have scope to enjoy the facility of compounding of the offence as compared to such provisions existing in the Income Tax Act, the CBDT has said.
The Compounding of Offences is a provision undertaken by the taxman under section 279(2) of the I-T Act keeping in view factors such as conduct of the person, nature and magnitude of the offence, cooperation extended by the assessee to the department during probe and facts and merits of each case.
Once a tax evasion offence is compounded, the accused is given relief by way of exempting him or her from paying penalty or reduction or abolishing of a jail term.
"The Central Board of Direct Taxes has made it clear in a recent directive to all the assessment and investigation ranges of the I-T department that the provision of compounding or to say settlement of an overseas tax evasion case under the new anti-black money Act is not be allowed as the scheme of the Act does not have such a feature," a senior I-T officer said.
The government has from July 1, 2015 enacted the Blackmoney (Undisclosed Foreign Income and Assets) and Imposition of Tax Act to deal with instances of Indians holding black money in foreign shores.
The new Act provides for tax and penalty of 120 per cent and jail term of up to 10 years for holding undisclosed foreign assets.
The image is used for representational purpose only; Photograph: Khaled Al Hariri/Reuters
