Finance minister Pranab Mukherjee is likely to come out with a white paper on black money in the coming Budget session to highlight the measures taken by the government and future course of action to deal with the menace.
According to the sources, the government would incorporate suggestions given by a panel headed by CBDT chairman. The committee is likely to recommend permitting income tax department to look into I-T filings of suspected assesses of past 16 years from six years at present.
However, the amnesty scheme to bring back illicit wealth from abroad is likely to be excluded as the committee has ruled out such an option. In May last year, the government had constituted a panel headed by Central Board of Direct Taxes (CBDT) chairman to look into strengthening of the law to curb black money generation and examine the existing legal and administrative framework. The committee is likely to submit its report by the end of February.
White papers discuss measures taken by the government to deal with an issue and implications of policy decisions. The demand for white paper on black money has been raised by main Opposition party BJP and also by corporate affairs minister Veerappa Moily in the capacity of law minister.
In a letter to the finance minister, Moily had demanded ??publication of a white paper on black money, or in the alternative appointing a commission headed by eminent personalities well-versed in banking and taxation matters.?? Senior BJP leader LK Advani too asked for a white paper from the government to know the intended measures it would take to bring back black money stashed abroad in foreign banks.
According to Rahul Garg, executive director at Pricewaterhouse-Coopers, the white paper on black money would create awareness and debate among stakeholders about the menace. ??It will show how serious government is to deal with the issue and the actions it intends to take,?? he added. The black money lying abroad has become a big issue for the government as it is under pressure from the opposition parties, supreme court and civil societies on the issue.
India has completed tax negotiation agreements with 58 countries, which include Double Taxation Avoidance Agreements and Tax Information Exchange Agreements. Out of these 58 treaties, India has amended DTAAs with 22 countries and signed new DTAAs with 19 nations. Besides, it has also signed 17 TIEAs.
Recently, India has revised DTAA with Switzerland so that banking and tax-related information could be shared between the two countries from April , 2011. The measures taken by the government are yielding results and India is getting information from 10 countries about banking and tax-related matters and actions have been initiated against the offenders.
Besides, the IT department has detected concealed income of R 18,750 crore in the last two financial years and the directorate of international taxation has collected taxes of R33,784 crore from cross border transactions during the same period.