New Delhi: In a bid to curb the menace of black money, the Finance Minister, Shri Arun Jaitley signaled the government’s intent to curb generation of black money in real estate in the Budget 2015-16. Presenting the Budget in the Lok Sabha today he proposed amendments in the Income Tax Act prohibiting acceptance or repayment of advance in cash of Rs. 20,000 or more for any transaction in immovable property. Penalties of equal amount will be imposed in case of contraventions.
In order to curb trade based money laundering, making false declarations/ documents in the transaction of any business relating to Customs (section 132, Customs Act) will be brought under the Prevention of Money Laundering Act as a “predicate offence”.
A Bill for a comprehensive new law to deal with black money parked abroad is likely to be introduced in the current session. Key features of the new law on black money are –
Evasion of tax in relation to foreign assets to have a punishment of rigorous imprisonment upto 10 years, be non compoundable, have a penalty of 300 % and the offender will not be permitted to approach the Settlement Commission.
Non filing of return/filing of return with inadequate disclosures to have a punishment of rigorous imprisonment upto 7 years.
Undisclosed income from any foreign assets to be taxable at the maximum marginal rate.
Mandatory filing of return in respect of foreign asset.
Entities, banks, financial institutions including individuals all liable for prosecution and penalty.
Concealment of income/evasion of income in relation to a foreign asset to be made a ‘predicate’ offence under PML Act, 2002
PML Act, 2002 and FEMA to be amended to enable administration of new Act on black money.
Also, the Government proposes Benami Transactions (Prohibition) Bill to curb domestic black money to be introduced in the current session of Parliament.