New Delhi: Government will notify the compliance window in the next two-three weeks for those holding undeclared assets abroad to come clean by paying 30 percent tax and 30 percent penalty, before the new black money law comes into force.
Talking to reporters a day after Parliament passed the black money law, Finance Minister Arun Jaitley on Thursday said that those who have unaccounted funds abroad and do not want to come clean by taking advantage of the compliance will "certainly have a lot to worry (about)."
The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Bill, 2015, which got the nod of the Rajya Sabha on Wednesday, two days after the Lok Sabha passed it, seeks to unearth unaccounted wealth stashed abroad.
Under the new law, persons having unaccounted wealth will be given an opportunity through a compliance window to come clean by declaring their assets and pay penalty and tax of 60 percent.
In case they do not take advantage of the compliance window, which will have a short duration, they would have to pay 30 percent tax, 90 percent penalty and face criminal prosecution which could result in jail term of up to 10 years.
"The compliance window will be in this financial year... The Central Board of Direct Taxes (CBDT) is working on the timeline for compliance window. They will be getting notified in a matter of 2-3 weeks," Revenue Secretary Shaktikanta Das said.
On the apprehensions being expressed that the new black money law is tough and could create hardship for people, Jaitley said: "Those who don't have illegal money or assets abroad have nothing to worry. Amongst those who express very very serious apprehensions, there is a give away in that."
Most people do not have illegal money or assets abroad, Jaitley said, adding that for those who have such funds, "this comes out as a fairly reasonable scheme. It is a taxation scheme where compliance time is given to you. So, comply with it. If you comply with it, then you save yourself from future problems.
"Now, there is a third category which has illegal assets abroad and which does not want to comply with it. Now they certainly have a lot to worry."
The Minister, while replying to a discussion on the Bill in the Rajya Sabha had said that "if you don't use this compliance window now, time will run out because by 2017 there will be a realtime automatic disclosure of information taking place".
He had earlier clarified that the new law would not cover those having amounts equivalent to Rs 5 lakh in bank accounts abroad, which may belong to students or those working there.
The black money law will deal with foreign assets and not the domestic tax evasion which was being taken care of by the Income Tax Act, he had said.
Meanwhile, the government had also armed itself with additional powers under the Prevention of Money Laundering Act (PMLA) to attach domestic property of equivalent value of offenders having unaccounted wealth abroad.
