Govt measures to curb parallel economy, unaccounted transactions

A Task Force (TF) on Shell Companies had been constituted under the joint chairmanship of Revenue Secretary and Secretary (Ministry of Corporate Affairs) in February, 2017. The task force has met 6 times so far.

FM Jaitley informed the Lok Sabha about the steps taken by the government to curb parallel economy, unaccounted transactions.Image source: Reuters

Union Finance Minister Arun Jaitley on Tuesday informed the Lok Sabha about the measures taken by the government to control and curb parallel economy and unaccounted transactions.

The measures to effectively control and curb the prevalence of parallel economy and unaccounted transactions include major steps.

1- Enactment of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 to effectively tackle the cases involving black money stashed abroad.

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2- Enactment of the Benami Transactions (Prohibition) Amendment Act, 2016 to effectively deal with domestic black money cases.

3- Constitution of the Special Investigation Team (SIT) on Black Money in May, 2014 under Chairmanship and Vice-Chairmanship of two former Judges of Supreme Court. The SIT has so far submitted 6 reports to the Supreme Court

4- Constitution of Multi-Agency Group (MAG) for coordinated and effective investigation in ‘Panama paper leaks’ cases and Paradise Leaks cases.

5- Task Force (TF) on Shell Companies constituted under the joint chairmanship of Revenue Secretary and Secretary (Ministry of Corporate Affairs) in February, 2017. The task force has met 6 times so far.

6- Various other anti-evasive legislative measures have also been taken.

7- Under international cooperation, the government is proactively engaging with foreign governments to enhance the exchange of information (EoI) under tax treaties. India, which has tax treaties with 148 foreign jurisdictions, joined a group of 48 countries as early adopters to new global standards for automatically exchanging information from 2017.

8- Interventions in regulatory framework by the CBDT include integration of PAN and TAN with MCA Portal; e-PAN Card for Company Applicants issued within 1 day from March, 2017; and MoU for exchange of information signed between Central Board of Direct Taxes and Ministry of Corporate Affairs.

9- Actions in the context of demonetization: The Income-tax Department adopted a multi-pronged approach to detect and seize undisclosed assets after the announcement of the demonetization scheme on 8 November, 2016. This included collection of high quality intelligence, identification and prioritization of high risk cases, creating deterrence while ensuring professionalism and integrity in investigations.

10- Under the Income Declaration Scheme, 2016, so far 71,726 cases have come to fore, wherein, Rs 67,382 crore were declared as undisclosed income.

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