'No estimate of black money stashed abroad in last 5 yrs': Centre makes revelation in RS

In a key revelation on Tuesday, the Centre stated that it has no estimates on the amount of black money in foreign accounts during the last 5 years. This was mentioned in a response by Union MoS Finance Pankaj Chaudhary to an unstarred question by Rajya Sabha MPs Sukhram Singh Yadav and Vishambhar Prasad Nishad. He also divulged that Rs.2476 crore was collected in the form of tax and penalty pertaining to disclosures about undisclosed foreign assets in the one-time window which closed on September 30, 2015, under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015. 

He added, "Total undisclosed credits amounting to Rs.20,353 crores have been detected with respect to 930 India-linked entities in the Panama and Paradise Paper Leaks. Taxes collected so far amount to Rs.153.88 crores in the Panama and Paradise Paper Leaks. Further, in 52 cases of Panama and Paradise Paper Leaks, Criminal prosecution complaints have been filed under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015. Further, in 130 cases proceedings under Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 have been initiated." 

Additionally, the Union MoS Finance observed that a penalty of more than Rs.1294 crore has been levied on account of deposits made in unreported foreign bank accounts in HSBC cases. He opined that the Automatic Exchange of Information, which has commenced in 2017, will greatly assist the global efforts to combat tax evasion. Fighting black money has been a manifesto promise of the BJP for the last many years. 

The fight against black money stashed abroad 

After assuming office in May 2014, the Narendra Modi-led BJP government at the Centre formed a Special Investigation Team (SIT) under the chairmanship and vice-Chairmanship of two retired Supreme Court judges to end the scourge of black money. Subsequently, the government launched a diplomatic outreach to several countries seeking information on suspicious accounts of Indian citizens. The Double Taxation Avoidance Agreement (DTAA) with Mauritius was amended to ensure that the government could tax the capital gains from the sale or transfer of shares of an Indian firm acquired by a Mauritian tax resident.

This was a step towards curbing the generation of black money via the Mauritius route. Meanwhile, in 2018, the then Union Finance Minister Arun Jaitley announced that India had inked a treaty with Switzerland regarding the real-time flow of information after the latter amended its domestic laws. In September 2019 and October last year, India received Swiss bank account details of its nationals and entities.