Warning black money holders of “serious trouble” if they fail to come clean, Finance Minister Arun Jaitley today said people with undisclosed assets should use the limited period income declaration window, beginning Wednesday, if they want to “sleep well”.
The four-month window under the Income Declaration Scheme 2016, which opens on June 1, allows domestic black money holders to declare their ill-gotten wealth by paying a tax and penalty totaling 45%.
“Starting from tomorrow, the new window opens and I will advise all those who have any undisclosed asset to declare it and pay the tax and sleep well. Otherwise, the way the disclosures are becoming more and more public, they will run into serious trouble,” Jaitley told PTI in an interview here.
Jaitley, who is on a six-day trip to Japan to invite investments, said the compliance window is open to not only the companies but also the people having undisclosed income.
“When the black money law with regard to foreign assets was passed, I had said please declare and sleep well. Now, those who didn’t declare and their names have become public, either in Panama Papers or otherwise, I think they are now having sleepless nights,” he said.
The government had last year come out with a three-month compliance window for foreign black money holders.
The domestic black money compliance window will open from June 1 to September 30, 2016 and the taxes and penalties can be paid within two months thereafter.
Under the scheme, income declared by the eligible persons would be taxed at the rate of 30% plus a ‘Krishi Kalyan Cess’ of 25% on the taxes payable and a penalty at the rate of 25% of the taxes payable. Tax and penalty will total to 45% of the income declared, which has to be paid by November 30.
The scheme will apply to undisclosed income whether in the form of investment in assets or otherwise, pertaining to Financial Year 2015-16 or earlier.
The declarations can either be made online on the official e-filing website of the Income Tax department, or before the various regional Principal Commissioners of I-T.
Asked about the pending retrospective tax cases of Vodafone plc and Cairn Energy of UK, Jaitley said, “We have already changed the law. They (now) have the option to either contest (the demand through) ligitation or go in for settlement.”
In his Budget for 2016-17, the Finance Minister has provided for waiving of interest and penalty if the companies facing retrospective tax cases paid up the principal amount.