Arun Jaitley to hold meet to discuss black money on Tuesday

Finance Minister Arun Jaitley will meet industry associations on Tuesday to clear doubts about the four-month window provided to holders of undeclared wealth to come clean.

Finance Minister Arun Jaitley
Finance Minister Arun Jaitley

This will be the first such meeting the Finance Minister will hold to explain provisions as well as clear misgivings about the one-time compliance window provided to domestic blackmoney holders to pay their taxes and escape harsher penalties.

The I-T department has already adopted a 4-pronged strategy to ensure success of the scheme.

Prime Minister Narendra Modi warned the black money holders to take advantage of the scheme or face action on Sunday.

“The minister will meet the industry chambers, CAs and other professionals tomorrow in relation to the IDS,” a finance ministry official said.

To let the domestic black money holders declare come clean, Jaitley had in Budget had announced a four-month window under the Income Declaration Scheme (IDS) 2016.

The scheme, which opened on June 1, allows domestic black money holders to declare ill-gotten wealth and come clean by paying a tax and penalty totalling 45%.

Modi has asked people to declare their undisclosed income by September 30, making it clear that this is the last chance to avoid problems that will follow after the window of opportunity closes.

“It will be better that you take advantage of the window provided and save yourself from the difficulties that you can face after September 30,” he said.

The four-pronged strategy prepared by the CBDT for the success of the scheme, includes single point contact to ensure confidentiality, setting up of facilitation centres across the country, giving wide publicity and monitoring at the highest.

Government has promised that there will be no inquiry into the source of the undisclosed income and assets if declaration is made voluntarily.

In order to give wide publicity, the CBDT has also suggested putting up posters about the Income Declaration Scheme-2016, at places frequented by potential declarants, like club houses, posh markets, showrooms of high end products.

Last year the government came up with a similar scheme for persons having unaccounted black money abroad. Disclosures during that window were charged with a total tax and penalty of 60%.

A total of Rs 4,147 crore of undisclosed wealth was declared during the 90-day foreign black money compliance window that ended September 30. At 60% (30% tax and 30% penalty), the government got a net tax of Rs 2,500 crore from the declarations.