Making it clear that there would be no amnesty scheme or any bailout scheme on voluntary disclosure of black money in the near future, the union government has given the nod for setting up of another committee to track taxable income of individuals and to track the money trail.
But, now it is an internal expert committee of Central Board of Direct Taxes (CBDT), which will gather data on income and assets earned — legally or otherwise — by individuals in India and that finally get parked abroad.
“The finance minister has given approval and we’re working on setting up the committee,” a finance ministry source told Hindustan Times.
According to CBDT sources, the expert committee, which will act exclusively as a support system to other panels and committees on black money, shall examine all means and modes of income earned by an individual in India, that are liable to be taxed.
“We’re trying to develop a reporting mechanism through which we can track the income of an individual, which is taxable in India, but where the money is parked in banks abroad or the person also earns money abroad in the form of royalty and evades paying tax on it in India,” the source said.
“Sometimes, an assessee may not be intentionally evading paying tax on his earning a royalty or remittances from abroad, which might happen due to ignorance — in that case the income tax department will help them sort out the problem,” the source added.
The income tax department will also look into the issues on whether the income was earned illegally, whether under-invoicing occurred in the case of exports or if any kind of round-tripping was adopted by using a shell company in a tax haven to return the funds into the country as foreign direct investment etc.