Lok Sabha Question No. 2245 (UNSTARRED), answered on 2016-07-29
Subject: Black Money
Ministry: FINANCE
Asked by: SULTAN  AHMED

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE LOK SABHA UNSTARRED QUESTION No. 2245 TO BE ANSWERED ON FRIDAY, THE 29 th  JULY, 2016 7, SRAVANA, 1938 (SAKA)

## BLACK MONEY

## 2245. SHRI SULTAN AHMED:

Will the Minister of FINANCE be pleased to state:

- (a) whether the Government has any policy in place for voluntary disclosure of income of individuals/corporate bodies, if so, the details thereof;
- (b) whether  such  schemes  amount  to  regularising  black  money  and  also  promote  and encourage wrong  doers to indulge in financial frauds in the hope of such exemptions in future;
- (c) the  steps  taken/proposed  to  rationalise  tax  slabs  to  a  lower  level  especially  for  highest slab tax payers  particularly Government employees;
- (d) the revenue generated through such last three disclosure schemes/amnesty schemes; and
- (e) the revenue likely to be generated by the latest amnesty scheme proposed by the present Government?

## ANSWER

## MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI SANTOSH KUMAR GANGWAR)

- (a) Vide  Finance  Act,  2016,  the  Government  has  introduced  the  Income  Declaration  Scheme, 2016(the Scheme) with effect from 1st June 2016 which is open for declarations upto 30th September, 2016. The Scheme provides an opportunity to all the persons who have not paid full taxes in the past to come forward and declare such undisclosed income and pay tax, surcharge and penalty totaling in all to forty-five per cent of such undisclosed income declared.

(b) The amount payable under the Scheme is 45% (which includes penalty @ 25% of tax) of the undisclosed income declared as against the maximum applicable tax rate of 30% plus surcharge. Further, the  Scheme  does  not  provide  for  deduction  in  respect  of  any  expenditure  or  allowances  against  the income  declared  under  the  Scheme.  It  is  thus  evident  that  the  Scheme  does  not  in  any  way  promote generation and circulation of black money but aims at channelizing the unaccounted money back into the mainstream of the economy by due payment of tax, surcharge and penalty on the income so declared.

- (c) The  tax  slabs  are  determined  each  year  for  individuals  considering  the  prevailing economic  situation  and  the  revenue  needs  of  the  Government.  There  is  no  separate  slab  for Government Employees.

It may also be mentioned that with a view to provide relief to small and marginal taxpayers and senior citizens, personal income tax exemption limit was increased through Finance (No. 2) Act, 2014  by  Rs  50,000,  that  is,  from  Rs  2  lakh  to  Rs  2.5  lakh  in  the  case  of  resident  individual taxpayers below the age of 60 years, and from Rs 2.5 lakh to Rs 3 lakh in the case of senior citizens, i.e., resident individual taxpayers of the age of sixty years or more but less than eighty years. The tax slabs have remained unchanged since then.

- (d) The details of revenue generated through last  three disclosure/amnesty schemes are as under:

| Name of the scheme                                                                                 |   Year | Income/ Wealth/ Assets declared (in Rs. Crore)                                  | Tax collected (in Rs. Crore)                                                    |
|----------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------|---------------------------------------------------------------------------------|
| National Housing Bank (Voluntary Deposits) Scheme, 1991                                            |   1991 | Deposits of 154 Crore received                                                  | Deposits of 154 Crore received                                                  |
| Remittances in foreign exchange (Immunities) Scheme, 1991 and India Development Bonds Scheme, 1991 |   1991 | Foreign exchange equivalent to 6400 Crore was collected under these two Schemes | Foreign exchange equivalent to 6400 Crore was collected under these two Schemes |
| Voluntary Disclosure of Income Scheme, 1997                                                        |   1997 | 33289                                                                           | 9745                                                                            |

It is further mentioned that the one time compliance window provided under the Black Money (undisclosed  foreign  Income  &  Assets)  Imposition  of  tax  Act,  2015  was  not  in  the  nature  of voluntary disclosure/amnesty Scheme.  However,  under  the said  compliance  window  an undisclosed foreign assets amounting to Rs. 4164 crore were disclosed by 648 declarants.

(e) Since, the Income Declaration Scheme, 2016 provides for declaration of undisclosed income on voluntary basis, no such estimation has been drawn.

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