Panel For Tax On Cash Withdrawal Beyond Limit To Curb Black Money

NEW DELHI: A high level official panel proposed levying of banking transaction tax on withdrawal of cash beyond a specified limit in a day to check black money and was not in favour tax amnesty scheme.

A report by the Parthasarathi Shome Committee, appointed by the previous UPA government, suggested taxing farmers with large land holdings in addition to host of measures to widen the net.

"Taxpayers keep waiting for amnesty schemes to be announced and take advantage of these schemes to build their capital.

"Amnesty schemes also cause inequity among taxpayers, and there is no proof that they improve taxpayer behaviour among evaders. They, therefore, should not be encouraged through amnesties," said the report of Tax Administration and Reform Commission (TARC). It was the third report in the series.

Highlighting that there is no instrument at present that captures details of cash withdrawals from bank accounts, it said such information would help the I-T department widen its information base on the use of black money.

Making a case for Banking Cash Transaction Tax (BCTT), it said: "...IT Act should be suitably revised to include in its ambit cash withdrawals exceeding specified amounts in a day from bank accounts other than savings accounts.

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