Have money in Swiss banks? Watch out, FM will get you

It looks like the government is finally taking the issue of black money seriously. While it still hasn’t been able to recover a significant chunk of this ill-gotten wealth, it is contemplating the next best thing: penalise those who send illicit wealth abroad.

Just days after CBI director AP Singh admitted that Indians are the largest depositors of illegal money worthan estimated $500 billion ,or nearly 24.5 lakh crore,in banks in countries considered as tax havens, a media report suggests that the income-tax (IT) authorities might tighter the noose around tax evaders.

According to a report in The__Economic Times, the finance ministry may clear a proposal to allow IT authorities to re-open assessments for up to 16 years from the current limit of 6 years. The proposal may be announced by Finance Minister Pranab Mukherjee in the forthcoming Union Budget on 16 March.

This amendment will not only act as a deterrent but also put pressure on people to disclose their assets stashed abroad. “Undisclosed earnings will continue to attract a penalty of up to 300 percent of the tax amount, interest and prosecution even if the tax law is amended to allow reopening of older assessments, " the article said.

So far, the government has shied away from estimating the actual amount of black money stashed away in offshore tax havens. Even after the French government handed the government a list of over 700 Swiss account holders of HSBC Bank, there was no effort made to unmask the guilty. Hence, the proposed amendment has been mooted keeping in mind reports of numbered and trust accounts of Indians in other jurisdictions.