In a move to allow hoarders to come clean on gold investments made with black money, the Centre is expected to announce a gold amnesty scheme soon. According to reports, gold hoarders will be allowed to declare possession of gold through black money and pay the applicable tax on them.
Also, the tax payable will apply to the entire value of the investment transacted without a receipt. Though the government is still working on the rate of tax to be involved, sources claim that an effective tax rate of approximately 33%, including the education cess, would be levied.
The government believes the gold amnesty scheme would help in bringing lakhs of crores of black money utilised for purchasing unaccounted gold to the surface. Earlier, the Centre had launched the Pradhan Mantri Garib Kalyan Yojana (PMGKY), an amnesty scheme with the same purpose.
Though the PMGKY had limited success due to certain circumstances, the government believes the new amnesty scheme will be able to overcome the hurdles with proper implementation.
The Centre, however, has also considered the notion among individuals where he/she could be vulnerable to intimidation by tax officials post-declaration. The new scheme would reportedly require taxes being paid upfront on the assets, unlike the previous programmes. This model is expected to bring down the number of such instances.
The new gold amnesty scheme is also expected to be a limited period scheme similar to that of the previous income declaration schemes (IDS).
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