In a stern message, the government on Friday said those who did not take advantage of the one-time compliance window to declare undisclosed foreign assets and come clean will “regret”.
“Those who did not declare have underestimated the power of information exchange. Will regret,” economic affairs secretary Shaktikanta Das tweeted.
The government on Thursday said it had received Rs 3,770 crore from 638 declarations under the one-time black money compliance window, and it would initiate action against those who have not disclosed their assets abroad. The people who have made the declarations will now have to deposit tax at the rate of 30% and penalty over and above this at the rate of 30% by December 31.
Das, who was the revenue secretary when the government introduced the Black money (undisclosed foreign income and assets) and Imposition of Tax Act, 2015, had said earlier that such assets “will be difficult to hide” as the government has started collating information from various countries and other sources.
“Fight against black money is a part of economic reforms. As a country we can’t allow ghost economy to undermine real economy and growth,” Das said in the tweet on Friday.
The government recently signed an agreement with the US on implementing the Foreign Account Tax Compliance Act (FATCA), which allows automatic exchange of tax information between the two countries with effect from September 30.
India has also become a part of the multilateral Automatic Exchange of Information (AEOI) agreement, which will come into force from 2017. This is set to help the government is getting tax- related information from several jurisdictions across the world.
Justice (retd) MB Shah, who heads the Special Investigation Team (SIT) on black money, told HT on Thursday: “We are considering a proposal to recommend appropriate changes in the law, so that any hitherto undeclared property or assets found to be owned by Indians abroad after Wednesday’s compliance deadline automatically becomes the property of the Government of India,” he added.
Analysts have termed the declarations as unexpected and fairly low in numbers.
“People were concerned about the confidentiality of the information that they disclose,” said Rahul Garg, leader, direct tax, PricewaterhouseCoopers. “They needed more assurance from the government. Also, since you have to pay 60% of the asset value, it is very expensive to disclose.”
However, the government re-iterated that further course of action will be only as per the law and not to harass people. “We have closed the window now. Whatever declarations have been made by them we accept, and those are the ones who would not be harassed at all,” revenue secretary Hasmukh Adhia said.