Centre has listed out steps including a Black Money Act to tackle the issue
The government has unearthed evasion of about Rs.50,000 crore of indirect taxes and undisclosed income of Rs.21,000 crore over the last two years, according to the Finance Ministry.
“The present Government has taken various decisions and steps to curb the menace of black money both within and outside the country in last two years,” according to a statement. “Enhanced enforcement measures have resulted in the unearthing of tax evasion of approximately Rs.50,000 crore of indirect taxes and undisclosed income of Rs.21,000 crore.”
The government has initiated prosecution in 1,466 cases over the last two years compared to the 1,169 cases in the previous two years.
Drop in the ocean
However, the amount unearthed so far as indirect tax evasions seems a drop in the ocean as the government collected indirect tax revenue of Rs.5.4 lakh crore and Rs.7.1 lakh crore in 2014-15 and 2015-16, respectively, with indirect taxes comprising an increasing share of total tax collections at a time when direct tax collections were missing their targets.
“Relative to the overall amount of money in the parallel economy, this is a small amount,” D.K. Srivastava, Chief Policy Advisor at EY, said. “But considering this has become an additional source of indirect collections for the government, this is welcome. It not only means additional revenue for the government but also the inclusion of these evaders into the tax net.”
The statement listed out other steps taken to tackle black money, including the Black Money Act being enacted with strict penalty provisions and the Special Investigation Team constituted under the chairmanship of ex -Supreme Court Judge Justice M.B. Shah.
New disclosure scheme
The government has also formulated a new Income Disclosure Scheme, which will open on June 1, 2016, and has introduced amendments to the Prevention of Money-laundering Act, 2002. At the same time, the government amended the Foreign Exchange Management Act (FEMA), 1999 as well.
“The amendments provide for seizure and confiscation of value equivalent, situated in India, in case any person is found to have acquired any foreign exchange, foreign security or immovable property, situated outside India, in contravention of Section 4 of FEMA,” according to the statement.
2015 Kashmir Despatch