Demonetization: 50% Penalty and 4 Years Limit for Unaccounted Deposit
Currently the Union Government has devised a new law for unaccounted deposit money. Yesterday, 25th November, 2016, Union Cabinet approved an improvement to the Income Tax Act which would levy a 50% tax on unaccounted deposited using the scrapped currency notes of Rs 500 and Rs 1000.
This rule is applicable until 30th December, 2016 with a four year lock-in period for the remaining unaccounted cash deposit. It means that the hoarders can get half their money back after a four years if they disclose their illegal deposit.
50% Penalty and 4 Years Limit for Unaccounted Deposit:
The Union Government also said that, “There will be a higher penalty of levying 90% tax for those people who do not voluntarily disclose their unaccounted cash.”
According to reports, during these two weeks Jan Dhan accounts have witnessed about Rs 20,000 crore being deposited in bank accounts.
According to reports, the government plans to bring an improvement to the Income Tax Act during the current winter session of Parliament to charge a tax that will be higher than 45% tax and penalty charged on black money which is disclosed in the one-time Income Disclosure Scheme that ended on September 30, 2016.
For black money holders, who did not utilize the window then they would be charged a higher rate which could be close to 60 per cent that the foreign black money holder had paid last year.
On 8th November, 2016, the government had given a 50-day period for people to exchange or depositing their old currency of Rs 55 and Rs 1,000 notes in their bank accounts.
The amendments approved by the Union Government have already been sent to the President for his assent and will possibly be introduced in Parliament next week.
On Friday, 24th November, 2016 PM Modi said that, “Some people criticizing the demonetization don’t have a problem with the government’s preparedness; their problem is that they didn’t get time to prepare.”