Top Government Measures to Curb Black Money in India
India has been battling against black money for decades. We saw a variety of measures taken in this enterprise to this date, but the current government has given it the status of “high-priority issue” this time same and is continually working on how the problem can be completely eradicated from the system.
The following are some of the major initiatives taken by the government to crack down on black money:
Special Investigation Team
One of the first things that the government did after coming to power was the setting up of Special Investigation Team (SIT) that is monitored by the Supreme Court. The group is responsible for probing individuals, organizations, and businesses that are found to be involved in black money dealings.
Restructuring of Tax Treaties
The government has updated the Double Tax Avoidance Agreement (DTAA) with Mauritius, as per which the individuals that have capital assets in India now have to pay capital gains tax.
The government has also negotiated agreements with many other countries. As a result, starting this year, the Organisation of Economic Cooperation and Development (OECD) countries have agreed to share information on foreign account holders with their home countries.
Benami Transactions (Prohibition) Amendment Act
In 2016, the Benami Transactions (Prohibition) Amendment Act was enacted by the government which aims at curbing the black money and the seizing of illegal or “benami” properties that have been purchased with black money.
Under the Benami Act, individuals dealing with any “no name” properties can face serious legal action and high penalties.
The government has also made it mandatory for the sellers and buyers of properties to quote Aadhaar numbers for the real estate transactions.
Other than these, there are many other ways the government is trying to control the problem of black money. However, the majority of these make use of technology.
For instance, as GST has placed all the industries under the scanner of GST council (under GSTN), illegal transactions that often involve black money are expected to reduce. Similarly, the various efforts to push Aadhaar in government processes and financial products are also expected to bring a huge improvement.