With the Finance Bill set to come up for discussion in the second half of the budget session, the revenue department has started the backend preparations for implementing provisions in the bill pertaining to domestic black money.
According to sources, the government will come up with a set of frequently asked questions (FAQs) to bring in clarity on declaration of undisclosed assets in India.
“This Finance Bill has a wider base, against the foreign blackmoney bill. Already queries have started coming in regarding valuations, joint ownership of property etc. They will be addressed in greater detail,” sources said.
In Budget 2016-17, the government unveiled a new scheme, asking those with undisclosed income to come clean by paying tax, surcharge and penalty on concealed income at a total rate of 45%.
Finance minister Arun Jaitley made the announcement as the government moved to tackle the menace of domestic black money. The minister said tax payers can clear up their past transgressions by paying tax at 30%, surcharge at 7.5% and penalty at 7.5%, which adds up to 45% of the undisclosed income.
“Unlike earlier schemes, we have imposed a penalty on the amount that is disclosed under this scheme,” Jaitley had said.
The compliance window will be open from June 1 to September 30, and those declaring undisclosed income can pay the amount within two months of making the declarations.
This will be the second such compliance scheme under the NDA government.
Last year, the government had enacted a similar window for illicit funds stashed overseas with assets worth Rs 4,000 crore being disclosed.
In case of the current window, while senior government officials are expecting a good number of disclosures, field officers feel otherwise.
“The government is aware that a lot of black money is in real estate itself. Benami transactions take place even today, and since the registration process is not transparent enough it is tough to crack them down,” field officers said.
According to a FICCI report, about a third of India’s black money transactions are believed to be in real estate, followed by manufacturing, and purchase of jewellery and consumer goods.