Disclose Information About Black Money, Earn Up-To 5 Crore, Says Government
June 3rd, 2018
Image for Representational Purpose | Credits : Moneylife
The Department of Income Tax has come up with a scheme called “Benami Transactions Informants Reward Scheme, 2018,” and “Income tax informant scheme 2018” in order to get people’s participation to unearth black money and reduce tax evasion.
Benami Transactions Informants Reward Scheme, 2018
“Under the Benami Transactions Informants Reward Scheme 2018, a person can get reward up to ₹1 crore for giving specific information in prescribed manner to the Joint or Additional Commissioners of Benami Prohibition Unit (BPU) in Investigation Directorates of Income Tax Department about benami transactions and properties as well as proceeds from such properties which are actionable under Benami Property Transactions Act, 1988, as amended by Benami Transactions (Prohibition) Amendment Act, 2016,” the government said in a release.
The government also said that it had found in many cases that black money was invested in properties in the names of others, even though benefits were enjoyed by the investor concealing his beneficial ownership in his tax returns.
The Benami Property Transactions Act, 1988, was amended by Benami Transactions (Prohibition) Amendment Act, 2016 to make the law stronger.
Income Tax Informants Reward Scheme
Under the Income Tax Informants Reward Scheme, 2018, sharing information for undisclosed black money hidden abroad would amount a reward of up to Rs 5 crore. However, “the total maximum reward under the two Schemes shall be restricted to Rs. 1 (one) crore as is the limit in this Scheme and if an informant is found eligible for reward under both the Schemes for information relating to the Act and the Black Money (Undisclosed Foreign Income and Assets) Act, 2015, the total maximum reward under the two Schemes shall be restricted to Rs. 5 (five) crore as is the limit in Income Tax Informants Reward Scheme, 2018”, says the order.
The release also mentions that foreigners will also be eligible for such reward. The government gave full assurance of protecting the identity of the persons giving the information.
Details of the Rewards scheme can be read here.
What is Benami Property?
A property bought by an individual, not under his or her name is benami property. People invest their black money in buying benami property to evade taxation. The real owner of these properties is hard to trace due to fake names and identities.
The Benami Transactions (Prohibition) Amendment Act, 2016
The government in July 2016 decided to amend the Benami Property Transactions Act, 1988. The amended act came into force on November 1, 2016. It provides for rigorous imprisonment of up to seven years, and a fine which may extend to 25 percent of the fair market value of the benami property. It also empowers the government to confiscate deposits of people using others accounts to convert unaccounted wealth into white money.
Also published on Medium.