Tax declaration scheme nets Rs 1500 crore in TS, AP
HYDERABAD: The rich and famous in Telangana and Andhra Pradesh have never been more worried. With just 48 hours to go to the deadline (Sept. 30 midnight) for the Income Declaration Scheme (IDS), a pet project of Prime Minister Narendra Modi to unearth black money stashed in the country, Income Tax officials are piling on the pressure on them to come clean with their undisclosed income.
And the pressure seems to be working. A top source in the IT Department said onetop business house in Hyderabad coughed up Rs 150 crore of undisclosed dough last week. It's the highest disclosure in the two states so far. The tax sleuths are expecting more big fish to surface in the next two days.
The source told New Indian Express that more than Rs 1500 crore of undisclosed income has been unearthed so far in the two states.
The quantum of disclosures has been such that the IT department of Telangana and Andhra Pradesh, which till last month stood 14th in terms of statewide collection of undisclosed income under the IDS scheme, has shot up to ninth in the country.
The IDS scheme opened on June 1 this year. Initially, the bid fish were not too forthcoming. Then, Income-Tax officials, under tremendous pressure from New Delhi, prepared a list of potential big fish and began 'persuading' them.
The department's focus is on capital gains cases (that is, income tax levied on sale of capital assets like land, houses, shares, etc). "We are tracking a large number of property transactions in which no capital gains tax was paid. We are persuading the sellers to pay up,'' the source said. In particular, the sleuths are looking sharply for transactions in which no PAN number was quoted.
Officials said businessmen resort to conversion of black money into white with the aid of unscrupulous share brokers and chartered accountants who facilitate them by making bogus entries in the books. ''But our department has cracked down on such persons in Kolkata and Mumbai, the major hubs of such activities, ever since IDS was introduced. We now have a database of such businessmen,'' a tax official said.
To make IDS effective, tax sleuths have stepped up surveillance on transactions. Assessees are being called up and 'persuaded' that the good times have ended. ''There is nothing voluntary about it any more," the source said. "Due to the tremendous pressure from Delhi, our department went all out, particularly in the last 15 days."
The trickle of businessmen coming in with their true returns has now grown into a good flow in the last two weeks. Till last month, the IT Department of TS and AP used to be in the middling position in terms of tax collections. Now having shot up to ninth, officials are expecting to rise higher in the two left to deadline.
New Delhi has been unrelenting in its pressure on the IT Department. Union revenue secretary Hasmukh Adhia is said to be monitoring the collections on a daily basis, through video conferences with chief commissioners of income tax of all states.
Ouch! Three things that hurt
1. Businessmen have been complaining that the income declared under IDS is being taxed at the high rate of 45 per cent.
2. Another point that's pinching the big fish is the proviso that the value of assets would be assessed as of July 1, 2016. So if someone owned unaccounted property worth Rs 1 crore in 2011 and its value has gone up to Rs 2 crore now, he will have to shell out 45 per cent of the current market value.
3. Cases that have been detected by IT raids cannot be declared under IDS.