Finance minister Arun Jaitley on Sunday said that bulk of black money is still within India and warned that those who did not declare overseas black money during compliance window will face the consequences.
Stressing that bulk of black money is still within India, he said there is a need to change the attitude to make plastic currency the norm and cash an exception and the government is working with various authorities to incentivise this change.
The Minister also clarified that Rs 6,500 crore of black money, talked about by Prime Minister Narendra Modi in his Independence Day speech, pertained to illegal money of account holders in the LGT Bank of Liechtenstein and HSBC Bank, Geneva, while declarations made under the one-time compliance window totalled Rs 3,770 crore.
Finance Minister also said the government will soon make furnishing of PAN card details mandatory for cash transactions beyond a certain threshold to check flow of domestic black money.
Jaitley also said that loans given by banks under MUDRA Yojana to entrepreneurs can only be withdrawn from ATMs.
The Finance Minister also blamed the “high taxation regime in the past” for encouraging tax evasion and said the present “government’s policy is rationalisation of tax structures, taxing at reasonable rates, placing more money in the hands of small earners, encouraging and promoting the use of plastic money by all sections of society and creating deterrence against those who continue to use unaccounted money”.
In the Facebook post titled ‘The NDA Government’s campaign against black money’, FM Jaitey also clarified that the previously assessed Rs 6,500 crore pertained to account holders in LGT Bank of Liechtenstein and HSBC Bank, Geneva, while declarations under the one-time compliance window by 638 persons totalled Rs 3,770 crore.
Stating that Switzerland has agreed to share information in various cases, Jaitley said the automatic exchange of information with various countries would also ensure that “those with illegal assets abroad, who have failed to make declaration, would now stand the risk of information relating to them eventually reaching the Indian taxation authorities”.
On the Modi government’s campaign against black money stacked abroad, FM Arun Jaitley said in its very first Cabinet meeting it implemented the Supreme Court’s direction to constitute the Special Investigation Team.
“Most assessments have been completed and wherever illegalities are being found, criminal prosecutions have been launched against beneficiaries of these bank accounts”, he said.
“A total peak balance of about Rs 6,500 crore in these accounts has been assessed,” he added.
Jaitley further said that the amounts involving HSBC lists and the recently concluded compliance window should not be compared with the past amnesty schemes relating to domestic black money.
“The campaign against domestic black money has to be separately dealt with for which Government is independently taking steps,” he said.
“In order to encourage international cooperation in the matters of tax evasion, the government has taken a series of steps,” Jaitley said while listing out the initiatives taken by the Prime Minister at G-20 and the FATCA agreement with US.
“The G-20 initiative is intended to lift the veil of secrecy in banking transactions and in real time inform domestic taxation authorities about transactions of their citizens internationally”.
He also advocated that the opening of a large number of payment gateways, internet banking, payment banks and the emerging reality of e-commerce will prompt the use of banking transactions and plastic money rise significantly.
“The JAM Trinity and the Direct Benefit Transfer of subsidies to the accounts of beneficiaries of various Government schemes will also be a step ahead in this direction,” he said.
The JAM trinity refers to Jan Dhan financial inclusion scheme, Aadhaar unique identification number with biometric details and Mobile phone number.
“Loans being made available to them by the banks can only be withdrawn from the ATMs by use of MUDRA credit cards which are being provided to them. More and more of their transactions will be through plastic currency or through the banking channel,” Jaitley said.