Central government has unveiled more plans to combat the menace of black money. Cash deposits above ₹ 2.5 lakh could attract tax besides a 200 percent penalty in case of income mismatch, the government said on Wednesday. The finance ministry announced this a day after Prime Minister Narendra Modi announced demonetisation of ₹ 500 and ₹ 1000 notes.
Finance Minister Arun Jaitely said that people can deposit as much cash as they want in the banks and replace the old notes. But added that the money will be open to tax scrutiny. Revenue Secretary Hasmukh Adhia elaborated how the government is going to take this forward
We would be getting reports of all cash deposited during the period of 10th November to 30th December above a threshold of ₹ 2.5 lacs in every account. The department would do matching of this with income returns filled by the depositors. And suitable action may follow. We would be getting reports of all cash deposited during the period of 10th November to 30th December above a threshold of ₹ 2.5 lacs in every account. The department would do matching of this with income returns filled by the depositors. And suitable action may followHasmukh Adhia Revenue Secretary
If the amount deposited do not match the income sources then it will attract a tax of 30 percent and and fine of 200 percent .
Arun Jaitley claimed that the recent measures government initiated will increase the credibility of the Indian economy. Only three percent of the Indian population is paying tax.
Modi’s announcement withdrawing ₹ 500 and ₹ 2000 has caused a panic among people. The banks were not open to public for last day. RBI has announced that the banks will function on Saturday and Sunday. People who hold notes of ₹ 500 and ₹ 1000 can deposit their money and get new currencies instead of the older ones till December 31.
Meanwhile former finance minister P Chidambaram has questioned the logic behind issuing the currency of ₹ 2000. Talking to journalists he said it is a puzzle to him.