Government to Make Overseas Assets Disclosure Mandatory

New Delhi: Mandatory reporting of assets held by individuals abroad and re-opening of I-T return filings up to 16 years are among the steps being proposed by the government to tackle the menace of black money. "I propose a series of measures to deter the generation and use of unaccounted money," Finance Minister Pranab Mukherjee said while presenting the Budget for 2012-13. The government has also proposed slapping a tax of 30 per cent on undisclosed money, credits, investments and expenditures, irrespective of the slab of income. Strengthening its efforts to check black money flow in the system, the Budget has proposed mandatory reporting for every resident having any assets, including financial interest in any entity, overseas. The same would be applicable for those having signing authority in any account located outside India. "Furnishing of return by such a resident would be mandatory irrespective of the fact whether the resident taxpayer has taxable income or not," according to the Budget. The proposal would be effective retrospectively from April 1, 2012. Besides, the government would bring in amendment in existing rules for re-opening of I-T return filings up to 16 years, where "the income in relation to any asset... located outside India, chargeable to tax, has escaped assessment". According to Mukherjee, the government would lay on the table of the House a White Paper on black money in the current session of Parliament. The Minister proposed introduction of a General Anti Avoidance Rule (GAAR) in order to "counter aggressive tax avoidance schemes, while ensuring that it is used only in appropriate cases, by enabling a review by a GAAR panel". Further, the Budget has proposed compulsory reporting requirement in case of assets held abroad and tax collection at source on trading in coal, lignite and iron ore.