NEW DELHI: Tax authorities would soon start targeting undisclosed overseas assets of individuals, who had acquired those when they were residents in India but had since become non-residents.
Changes proposed to the black money law as part of the 2019-20 budget are aimed at covering such non-residents who possess undeclared overseas assets, a government official said
The move comes amid reports of many high-net-worth individuals moving out of India and changing their residency status.
Finance minister Nirmala Sitharaman on Friday proposed to change the definition of ‘assessee’ retrospectively from July 1, 2015, to include a non-resident or resident but not ordinarily resident, who was residing in India in the year before an undisclosed asset was acquired.
Incidentally, the black money law covers the direct owner of an asset as well as a beneficial owner. The law was part of the Narendra Modi-led NDA government’s big crackdown on black money in its first term. It had offered an amnesty scheme, giving one last opportunity to people to come clean and declare their overseas assets with a 30% tax and 30% penalty.
Under the law, tax evaders will have to pay 30% tax plus a penalty of 90%. They could also face up to 10 years of rigorous imprisonment. The changes to the Act had become imperative to give more teeth to the authorities to go after tax evaders, who may have changed their residency status.
India is now receiving information on assets held overseas by Indians under various global treaties, making it easier for authorities to nab evaders.
Source: economictimes.indiatimes.com