New Delhi: The Income Tax officials are under pressure to make the Pradhan Mantri Garib Kalyan Yojana a success. The scheme is an amnesty scheme asking everybody to their undisclosed income at 50% tax. The Narendra Modi government has set a target of Rs 2 lakh crore from the scheme till March 31, 2017, according to sources.
Revenue Secretary Hasmukh Adhia recently discussed the implementation of the scheme with the income tax officials across the nation via video conferencing. The Income Tax officials have been told to get as much black money as possible declared under the scheme. The strategy of the IT officials will be to force people to pay tax first and then declare the money under the PM Garib Kalyan Yojana.
Under the Garib Kalyan Yojana, 30% tax is imposed on the disclosed amount, 33% surcharge on the taxed amount and 10% penalty on the disclosed amount. This effectively comes to 50% tax on the disclosed amount. Of the balance 50%, 25% amount will be locked in with the government for 4 years, without interest. The balance 25% will be white money that the despositor will be allowed to take home.
Getting tax first is being emphasised as in normal case the seized cash goes into litigation and the tax accrues only after two three years. Under the previous amnesty scheme, Income Disclosure Scheme, the declarants were supposed to pay taxes in four equal installments, with the first installment to be payed by November 30. However, the figures that emerged after November 30 were much below government's expectations. Faced with this reality, the government does not want to take any chances with the second amnesty scheme.
Another reason for focus on Garib Kalyan revenues is that the government will showcase the disclosures under the scheme as a success of note ban and PM's war against black money. Also, it will go a long way to prove that the government has "robbed the rich to pay the poor", sources said.
That government wants to force people to deposit money in PM Garib Kalyan Yojna is proved by the fact that this scheme has been exempted from the new deposit rules. In fact, sources say, that the restrictions on deposits were imposed just to force people to make deposit in the scheme, which is brain child of PM Modi. (News24Bureau)