Government Raises ₹35,104 Crore Tax Demand Under Black Money Law
Why in News ?
The Indian government raised a tax demand of ₹35,104 crore under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 over the last decade, but actual recovery remains low at ₹338 crore.
Tax Demand and Recovery under Black Money Law
● Between July 1, 2015, and March 31, 2025, tax demand raised under the Act totaled ₹35,104 crore.
● This includes ₹13,385 crore from penalties under various sections of the law.
● Despite high demand, the actual recovery (tax, penalty, interest) is only around ₹338 crore.
● A total of 163 prosecution complaints were filed by March 31, 2025.
● Tax demands are created through completed assessments amounting to ₹21,719 crore.
Data on Undisclosed Foreign Income and Swiss Bank Deposits
● Indian-linked funds in Swiss banks reportedly tripled in 2024 to about 3.5 billion Swiss francs (~₹37,000 crore).
● Swiss National Bank (SNB) data includes customer deposits, liabilities, and bank dues across multiple jurisdictions.
● The Swiss authorities caution against using SNB data to analyze deposits held only by Indians or country-wise breakdowns.
● The government stated there is no centralized data for country-wise undisclosed foreign income or tax demand.
● Indian tax authorities rely on Automatic Exchange of Information (AEOI) agreements for cross-border data sharing.
| Understanding Black Money Act and Tax Enforcement :● The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 aims to curb offshore tax evasion. ● It mandates disclosure of foreign assets and imposes penalties and prosecution for violations. ● The Act is enforced through tax assessments, penalties, and prosecution complaints. ● Automatic Exchange of Information (AEOI) enables countries to share financial data to detect black money. ● Despite efforts, tax recovery remains challenging due to complex cross-border asset holdings and legal processes. |