The 'Black Money Act' which came into existence in 2015 and was enacted with an aim to abolish undisclosed foreign income and assets, has started reaping significant results.
The Bharatiya Janata Party (BJP) had raised the issue of the prevalence of black money during its 2014 election manifesto, and after being elected, an SIT (special investigation team) to probe cases of black money stashed abroad was set up.
Under various sections of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, till May 31, orders have been passed in 166 cases, according to a press release issued by the Union Ministry of Finance.
As a result, the government has raised a demand of ₹8,216 crore from detecting violations of the act in the form of non-disclosure of foreign income and assets. Moreover, 107 prosecution complaints have been filed in relation to black money stashed abroad under the purview of the act, reported India Today.
On Monday, July 26, the government informed the Lok Sabha that an undisclosed income of ₹8,465 crore was brought to tax, and a penalty of ₹1,294 crore has been levied in HSBC cases.
The law has helped the government to crack down on undisclosed income of approximately ₹11,010 crore in relation to the International Consortium of Investigative Journalists (ICIJ) cases.
Moreover, an undisclosed credit of approximately ₹20,078 crore has been detected in connection with the cases related to the Panama Papers. Meanwhile, an amount of roughly ₹246 crore has been tracked in connection with the Paradise Paper leaks, as stated in the press release.
Black Money In Swiss Banks
In relation to the amount of black money stashed away in the Swiss Bank for the last 10 years, Minister of State for Finance Pankaj Chaudhary said, "There is no official estimate of the black money stashed in Swiss Bank for last 10 years."
According to the India Today report, the Income Tax Department has led several investigations during the past five years, leading to a greater prosecution of tax evaders under the Income Tax Act.
Steps Taken By The Government
Chaudhary informed the Lok Sabha that the government has taken several measures to retrieve the black money stashed out of the country.
Image Credit: Ministry of Finance
He said, "Apart from prescribing more stringent penal consequences, the black money law has included the offense of wilful attempt to evade tax in relation to undisclosed foreign income/assets as a Scheduled Offence under the Prevention of Money-laundering Act, 2002 (PMLA)," reported India Today.
Chaudhary also stated that the government has been attempting to improve the exchange of information under the Double Taxation Avoidance Agreements (DTAAs)/Tax Information Exchange Agreements (TIEAs)/Multilateral Conventions.
Moreover, the availability of data on investments by Indians made overseas has led to efforts to build a multilateral regime for proactive sharing of financial information, known as the Automatic Exchange of Information (ATI).
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