Finance Minister Arun Jaitley introduced the Taxation Laws (Second Amendment) Bill,2016 in the Lok Sabha. The Bill seeks to impose a higher rate of tax and penalty in respect of undisclosed incomes.
The amendment has proposed to tax at 50 per cent the unaccounted demonetised cash that is disclosed voluntarily till December 30.
After the date a steep up to 85 per cent tax and penalty will be levied on undisclosed wealth that is discovered by authorities.The Bill proposes a Pradhan Mantri Garib Kalyan Yojana 2016 wherein the unaccounted, now banned 500 and 1000 rupee notes, deposited in banks between November 10 and December 30, will be taxed at 30 per cent plus a 10 per cent penalty. A 33 per cent surcharge on the tax will take the total levy to 50 per cent.
The Bill proposes to amend Section 115BBE of the Income Tax Act to provide for a steep 60 per cent tax and a 25 per cent surcharge on it (total 75 per cent) for black money holders who choose to disclose after PMGKY ends.
Another section inserted provides for an additional 10 per cent penalty on being established that the undeclared wealth is unaccounted or black money, taking the total incidence of levies to 85 per cent.