In a bid to stop tax invasion and black money, the Central government has introduced three new reward schemes under which a person can get up to Rs 5 crore for information on tax evasion and benami (proxy) transactions and properties. According to Finance Ministry, the maximum reward for information on tax evasion in India is Rs 50 lakh, while a person can get maximum Rs 5 crore for giving specific information about substantial tax evasion on income and assets outside India. The Finance Ministry report added that one can get a reward of up to Rs one crore for information on benami transactions and properties.
The government had earlier introduced the Black Money (Undisclosed Foreign Income and Assets ) and Imposition of Tax Act, introduced in the year 2015. The main objective of this scheme is to investigate income and specific assets kept in foreign countries by people taxable in India, recover tax on it and take other actions like penalty and prosecution.
As per ministry official statement, “With the objective of attracting and encouraging people to give information about such income and assets reward up to Rs five crore has been introduced in the new reward scheme. The amount has been kept high to make it attractive to potential sources in foreign countries.”
The report added that it was found in many cases that black money was invested in properties in the name of others, even though benefits were enjoyed by the investor concealing his beneficial ownership in his tax returns. The new schemes will help the government to unearth black money and reduce tax evasion. In November 2016, the government had banned Rs 500 and Rs 1,000 notes, which was criticized by opposition parties saying that it was a financial blunder.