The government may give six month’s grace period for people having undisclosed income and assets abroad it to declare and thus avoid prosecution and imprisonment made under the new black money bill.
The grace period and non-prosecution clause for people revealing black income while paying the pernalty tax are usually interpreted as amnesty for the black money holders. But so far, the government is careful of not mentioning them as amnesty provision.
The Undisclosed Foreign Income and Assets (imposition of Tax) Bill is now under the Parliament’s consideration. It envisages initiation of prosecution, imposition of higher penalty and ten years of imprisonment on those who are having undisclosed income and assets in foreign countries.
As per the bill, the black income and asset holders in foriegn countries have to pay a tax includign a penalty of nearly 57 per cent of their foreign income and assets.
Though these severe proceedings are there in the Bill; they are applicable to persons who are keeping black money in future.
In many foriegn countreis, black money legislations gives a chance for the existing black money holders to disclose it by paying a penalty in the form of higher tax. For this generally, black money legislations gives an opportunity for the income holders to disclose it within a given time period. This is interpreted as amnesty provision.
For India, it is expected that the grace period will start once the Parliament passes the bill.