Only Rs. 4,900cr disclosed under Pradhan Mantri Garib Kalyan Yojana
Pradhan Mantri Garib Kalyan Yojana (PMGKY) recovered a mere Rs. 4,900 crore worth black money, disclosed by 21,000 Indians. Almost Rs. 2,451 crore was collected by the I-T department from these declarations, a top official confirmed. The plan was propelled in December'16 by the government to allow people to come clean by paying tax and a penalty of 50% by 31st March 2017.
Pradhan Mantri Garib Kalyan Yojana announced
Pradhan Mantri Garib Kalyan Yojana is an amnesty scheme, which started on 17 December'16 and remained open until 31st March'17. Those who declared cash deposits under the PMGKY were to be levied a charge of 50%, (30% tax, 33% surcharge and 10% penalty). In addition to this, 25% of the cash declared would be given to Pradhan Mantri Garib Kalyan Deposit Scheme for 4 years.
Government opens a black money tip-off email account
Along with the scheme, the government asked the people to "email any tip-off" about black money hoarders. "We have set up a specific address for direct information on black money, which is blackmoneyinfo@incometax.gov.in," Revenue Secretary Mr. Adhia said.
But, what led to PMGKY's failure?
Black money is hoarded over years, yet taxes had to be paid together. Few taxpayers had the money to pay under Income Tax Declaration Scheme and PMGKY. Secondly, PMGKY tax rate was exorbitant. Simply put, no businessman would willingly pay 50% of tax and immobilize 25% for 4 years. Moreover, the government was short on manpower to have executed demonetization, IDS and PMGKY all at once.
What the government has to say?
The government was counting on PMGKY tax collections to prove November 8 was a success, had claimed that Rs. 10,000 crore would return. Arun Jaitley, speaking on the PMGKY, said that it was heralded by related schemes and its response shouldn't be seen in isolation. He said that the IDS preceded PMGKY and therefore, he said that the disclosures should be seen collectively.
