New Delhi, September 30, 2016: Although prime minister’s claim to bring 1.5 million rupees to each tax payer froze over the ambiguity of offshore accounts, it would be interesting to note if Finance Minister Arun Jaitely could bring some good news tomorrow when he officially announce the numbers in closure of Income declaration Scheme 2016.
“The finance minister is having a press conference tomorrow at 3:00 pm. He will disclose all the numbers,” said an official from Income tax department.
Amidst high speculations about tax collection and income declaration under IDS 2016, the window to cap black money closes today midnight. The IT department would work till midnight to save last minute rush. The tax payer can disclose black money online as well as in person.
The clear contender to NDA’s Income disclosure scheme (IDS) 2016 is voluntary disclosure of income scheme (VDIS) 1997. The total declarations under VDIS were hailing Rs 33,000 crore, while the total tax collection amounted to Rs 10,000 crore. The success of VDIS laid by finance minister P Chidambaram was primarily due to lower tax cap of 30%.
After the media reports in the first week of September termed the IDS 2016 as “flop scheme” due to a very high tax cap of 45%, news about overwhelming response to the IDS scheme started raking in the newspapers the following week to scrap the earlier view.
In contrast many sources have claimed today, a day before the final closure of Income Declaration Scheme, that the income tax department has received black money declarations up to Rs 20,000 across India and the last day may register a record Rs 10,000 crore of revelations.
The “pressure” on the Narendra Modi led NDA government was apparent in last few weeks. The government used all tactics to allure the taxpayer to disclose the income. Despite reiterating “no action” or “investigation” and “assured secrecy” tax rate of 45% seemed to have muted the response to the scheme. Government even warned those who are misusing taxes of dire consequences, penalties of 100 % – 300 % and imprisonment of 7 years.
At the same time, to ease the disclosure of black money, the IT department started accepting declarations without Permanent account number (PAN) and asked those parties to attach a separate application for allotment of a fresh PAN account to them quickly.
News regarding massive raids on small shopkeepers and street vendors started making the buzz. With rising number of raids, Delhi CM wrote a mail to Prime Minister Narendra Modi and claimed that the centre was targeting the country’s small traders following the “failure” of its Income Declaration Scheme (IDS).
“All the small shopkeepers and businessmen of country are afraid of new campaign launched by your Income Tax (I-T) department. There is news that small stalls of roadside like jalebi and vada pav sellers are being raided by IT officials and you have given orders to raid country’s one lakh small traders from October,” the chief minister said in the letter.
The opposition sharply accused the government for harassment of small businesses, simply for filling the gaps to support scheme and meet the targets.
It would be a watch game tomorrow when FM discloses the numbers after Friday’s midnight buzz.