The Big Story: White wash
The government on Monday introduced a new bill in Parliament that sets the terms of what is effectively a new income declaration scheme for black money holders, two months after the end of the previous “last chance” to come clean. The Taxation Laws (Second Amendment Bill) allows citizens to declare unaccounted income under the new Pradhan Mantri Garib Kalyan Yojana. Through a combination of tax, penalty and a surcharge on top of the tax, this income will essentially be hit with a 50% charge. Additionally 25% of the disclosed income will have to be placed in an interest-free deposit scheme for four years.
The main aim of the new rule is to plug the loopholes in the current taxation law that would have allowed black money holders to simply declare unexplained income in advance tax returns this year and attract taxes without any penalty. In fact, the most recent figures of money deposited into banks following demonetisation, coupled with various moves to limit cash exchange options, suggest the government is seriously concerned that those with illicit funds have managed to deposit it – in the hopes of turning the money white – without a major hit.
Those who are found with unaccounted money without declaring under the Pradhan Mantri Garib Kalyan Yojana will be hit with taxes and penalties amount to about 75%. The taxation laws are retrospective, covering this entire fiscal year and any advance tax returns filed so far, although the government has taken pains to insist that they aren’t technically so because the year is still on-going.
For all the government’s vilifying of black money holders then, with the government calling it a “crime against humanity”, it has given them yet another chance to return to the system. To add to the narrative that the entire demonetisation effort has involved suffering for a better future, the government has directly grafted a pro-poor scheme to the declaration scheme, so that it cannot be accused of simply giving the black money holders a legal way to launder cash.
After the mixed results of the previous income declaration scheme, and the clear indication that those with illicit cash were finding ways around the demonetisation move, the question remains: Will black money holders play ball?
The Big Scroll: Scroll.in on the day’s biggest story
- Centre’s push to go cashless will have to surmount illiteracy, lack of trust in digital payments, reports Anumeha Yadav.
- Demonetisation conversations: Ajaz Ahmad tells us why even his radical Leftist friend is cheering Modi’s move.
- As Nitish Kumar earns Amit Shah’s praise for backing demonetisation, Dhirendra K Jha asks if his gamble will pay off?
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- Praveen Gopal Krishnan in The Ken produces a fun illustrated guide to the mess that is India’s food-tech industry.
- “If the Bengal Bandh had had enough of its bedridden life, Monday was a good day to die,” says The Telegraph.
- Nitish Kumar and Naveen Patnaik’s decision not to toe the Opposition line is a useful reminder of the complexity of Indian politicking, says a leader in The Indian Express.
- “Small, sustained, everyday challenges to a heteronormative order has the potential to liberate everyone who finds themselves circumscribed by that order, not just sexual minorities,” writes Rihan Najib in Mint.
- James Crabtree in Foreign Policy says Modi’s demonetisation move “was poorly planned, chaotically implemented – and may turn out to be his biggest political victory yet”.
Syed Nomanul Haq reviews a new book, by Manan Ahmed Asif, challenging a centuries-old text about how Islam came to India.
“The perennial career of The Chachnama is a fascinating fact, not only of textual history, but also of political and ideological history. There exists ample testimony that its sustained presence on the intellectual and colonial horizons explains much; its presence has a massive historical valence. And now, some 800 after the life of Kufi’s tract began, during which it was appropriated in diverse directions by all kinds of scholars, ideologues, and by imperial servants of the East India Company, Asif takes on in his book the ambitious task of hitting at the very foundations of this appropriation, reception, and understanding of The Chachnama.
This is a monumental task and one stands in awe of Asif’s research stamina and his refreshing historical acumen. To scale and, in the process, aim to crack and then pulverise the hardened rock of ages is no mean feat.”