No amnesty norm for black money hunt
The government has no plans of bringing in a new amnesty scheme for unearthing hidden wealth, the Rajya Sabha was told on Tuesday.
By ET Bureau |
NEW DELHI: The government has no plans of bringing in a new amnesty scheme for unearthing hidden wealth, the Rajya Sabha was told on Tuesday. Finance minister Pranab Mukherjee said the government was seeking to amend the Indo-Mauritius tax treaty to curb its abuse by companies.
���A committee was set up in 2004 and has made some recommendations but I am not enamoured with another disclosure scheme,��� Mr Mukherjee said during the question hour in Rajya Sabha.
Mr Mukherjee pointed that voluntary disclosure schemes cannot be hugely successful unless the rate of tax under the amnesty is lower than the prevailing income tax rates and this amounts to penalising honest tax payers by asking them to pay tax at higher rates.
���Various schemes have been introduced since the 1950s. I myself piloted a voluntary disclosure scheme. However, we have been receiving complaints that such schemes actually penalise honest taxpayers as those who disclose their wealth through such schemes actually pay lower taxes,��� he said.
To a query on India-Mauritius Double Taxation Avoidance Agreement, he said the government was seeking an amendment to the Indo-Mauritius tax treaty of 1980 wherein offshore firms registered in Mauritius do not have to pay capital gains.
India-Mauritius tax treaty provide that capital gains arising in India from the sale of securities can only be taxed in Mauritius and since the island nation does not tax capital gains, it leads to zero taxation.
���We want to amend the agreement of the 1980s. We are saying let us calculate the financial losses (to Mauritius) and compensate them through other means. We can provide them aid.... Talks are on,��� Mr Mukherjee said.
���A committee was set up in 2004 and has made some recommendations but I am not enamoured with another disclosure scheme,��� Mr Mukherjee said during the question hour in Rajya Sabha.
Mr Mukherjee pointed that voluntary disclosure schemes cannot be hugely successful unless the rate of tax under the amnesty is lower than the prevailing income tax rates and this amounts to penalising honest tax payers by asking them to pay tax at higher rates.
���Various schemes have been introduced since the 1950s. I myself piloted a voluntary disclosure scheme. However, we have been receiving complaints that such schemes actually penalise honest taxpayers as those who disclose their wealth through such schemes actually pay lower taxes,��� he said.
To a query on India-Mauritius Double Taxation Avoidance Agreement, he said the government was seeking an amendment to the Indo-Mauritius tax treaty of 1980 wherein offshore firms registered in Mauritius do not have to pay capital gains.
India-Mauritius tax treaty provide that capital gains arising in India from the sale of securities can only be taxed in Mauritius and since the island nation does not tax capital gains, it leads to zero taxation.
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���We want to amend the agreement of the 1980s. We are saying let us calculate the financial losses (to Mauritius) and compensate them through other means. We can provide them aid.... Talks are on,��� Mr Mukherjee said.
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