We can now open 10-year-old accounts to trace black money, says revenue secy
Revenue secretary Hasmukh Adhia explains the details of the crusade undertaken by the Modi government against black money.business Updated: Feb 03, 2017 08:51 IST
It is just a day after the budget, and the revenue secretary understandably looks groggy from the past few months of hard work. But Hasmukh Adhia is still not short of energy when it comes to explaining the details of the crusade undertaken by the Narendra Modi government against black money. Following are the excerpts:
How much have the income disclosure schemes added to your tax collection?
The direct tax collection has jumped from 6% in 2015-2016 to 15% this year entirely on account of our action against black money. And we are not even taking into account the tax that has come in from the Pradhan Mantri Garib Kalyan Yojana. Also we have got Rs 7,000 crore from IDS (income disclosure scheme) till December 2016. We are supposed to get another 25% of the total money declared by end of this financial year.
After demonetisation what is on your agenda to curb black money? Is the ban on cash transaction above Rs 3 lakh a sequel to demonetisation?
The difference between demonetisation and this is that the former is used to destroy the stock of black money while the ban will prevent the future flow of black money. If you cannot transact beyond Rs 3 lakh in cash, where will you use your black money? People with black money use it for conspicuous consumption. Cash purchases of expensive cars, stays at luxury hotels for disposal of black money will now stop.
After demonetisation and IDS do you see a significant expansion in your tax base?
The lowering of the entry tax slab from 10% to 5% will also prompt many people to file tax returns. And revenue will come as many more people will now pay taxes given our continuous action against black money.
How many years can you go back and scrutinise books of accounts to catch tax evaders?
We can now open accounts for 10 years in those cases where I can detect money or property for which tax has not been paid. But this detection has to come while scanning the person’s accounts for the previous six years. But for foreign property and money stashed abroad we can scan up to 16 years.
There was huge expectation that corporate tax on all businesses will be reduced.
When people say that our corporate tax is hampering investments from coming in it not true. We have already reduced corporate tax on new manufacturing units last year to 25%. The loss of revenue for extending this cut in corporate tax on every business is very high; every 1% cut in corporate tax for all entities costs us Rs 18,000-Rs 19,000 crore. The effective rate of tax paid by 300 companies making a profit of Rs 500 crore is 25%, so why do we need to reduce it just now?
First Published: Feb 02, 2017 21:33 IST