The Parliament on Wednesday passed Bill to deal with black money stashed abroad but not before facing serious accusations in the Rajya Sabha from senior lawyer and expelled BJP member Ram Jethmalani.
After struggling to seek extra time from Deputy Chairman PJ Kurien, Jethmalani charged the Government with not being sincere in bringing back black money stashed abroad. He said while the German side had agreed to share information on the account holders, the Government did not show any interest nor signed the letter declaring its intent to bring back money stashed abroad. Finance Minister Arun Jaitley, however, denied all the allegations claiming it were factually incorrect.
Opposing the Bill citing loopholes in it, Jethmalani said he was the lone person in the House opposing the Bill despite fighting to bring back ill-gotten wealth from abroad.
The senior lawyer said that despite promises made during lok Sabha elections last year, the Government has “ridiculed” itself on the issue and has gone back on the promises made.
Referring to the UN convention on black money, he said the Government was not ratifying it to facilitate the exchange of such information though it is a signatory to it.
Jaitely warned those having such assets to utilise the ‘compliance window’ or have sleepless nights once the global automatic information exchange system comes into effect in 2017. He said the new law will help “squeeze” black money even as he underlined that the option of ‘compliance window’, which may run for a few months, was not an amnesty scheme.
“The world is no longer willing to tolerate tax havens which thrive in secrecy,” he said, just before the ‘Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Bill, 2015’ was approved by the House, two days after the lok Sabha passed it.
Elaborating on the initiatives taken by the global community to promote automatic exchange of information, Jaitley said the US Government has initiated Foreign Account Tax Compliance Act (FATCA). If a financial institution does not comply with FATCA, it would have to pay a 30 per cent withholding tax on all its US revenues including dividend, interest, fees and sales. India is joining the agreement.
He also informed the House that G-20 group is working on putting in place a mechanism for automatic exchange of information likely to become operational from 2017. Members from all political parties participated in the three hours debate and most of them suggested that the Government restrain from using the term blackmoney since it has a racist connotation.
The Rajya Sabha was later adjourned sine die. Prime Minister Narendra Modi also came in the House after the passage of the Blackmoney Bill and was present till adjournment before which Opposition members took objection to a suo moto statement by Sports Minister Sarbanand Sonowal who himself was not present.