Black Money Act- the need of the hour

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There are people who are getting richer and richer day by day and there is the poor common man who is being pushed to the depths of poverty. What do you think is the reason for this?  This is a universal truth which everyone knows; it may be the common man, Ministers, Government officials or the Richie rich of the country. But, this is definitely not right, and specifically for the common man who is working hard, taking care of his family and even paying income taxes. It is definitely the duty of the Government that, some action has to be taken. After, all if this continues to go, a time will come when even the common public will refrain from paying the taxes and employing other unlawful means. There are definitely some really rich people who pay their taxes as well, just at the right time and by the appropriate amount. However, there are many more, which have their money in crore and lakhs stalked in the foreign accounts. This is a definite impact in the Indian economy and it also affects the simple man who is honest and deserves a better place and better facilities.

In order to ensure that the money stalked in the foreign accounts comes back to the country and utilised in providing facilities to the common public from that amount, the Government had launched the Black Money and Imposition of Tax Act, 2015.  It is also known as Black Money Act.

What is Black Money Act?

The Black Money Act came into effect from July 1, 2015. It was on May 26, 2015 that the act received the assent of the President. It was passed by both the houses of the Parliament. The objective of the act is to enable the disclosure of foreign assets undisclosed and the black money and at the same time, put a penalty on that income.

What has been the impact of the Act?

There has been a collection of about Rs. 2,428.4 crore by the Government with the aid of 600 declarations to the Income tax department. This amount was received by the road of tax and penalty till the December 31 date. However, the Government feels and knows that this is still less than the expected amount. A downfall in the collection is also related to the disqualification of some tax man and others which came after the December time limit.

Those who declared the money and income were required to pay tax on the amount at 30%. They were also required to pay an amount of 30% as a penalty on the asset value, which was declared by December 31, 2015. This act had actually provided with a onetime compliance window for black money holders to come clean. There was also the notification of a stricter law in the pipeline to curb the turbulence and negativity related to the black money. Those who have not abided with the Black Money act will have to pay 120% tax and penalty. They will also have to face imprisonment of 10 years.

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