In Late-Night Black Money Count, Tax Officials Raced To Beat 1997 Record

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In Late-Night Black Money Count, Tax Officials Raced To Beat 1997 Record

The voluntary disclosure of income scheme was announced to recover unaccounted wealth or black money.

New Delhi: 

Highlights

  1. Tax officials worked late last night to tally income disclosures
  2. Govt to announce collections, revenue from black money today
  3. Officials hope to surpass collections from 1997 scheme

For inhabitants of the dreary offices of Central Board of Direct Taxes or CBDT in the North Block of the cabinet secretariat in Delhi, it was an unusual night.

Most offices in the building on top of Raisina Hill had shut down long ago. But in a section near the western wing, facing the Rashtrapati Bhavan forecourt, the lights were on and nightfall had only hastened the pace of summing up voluntary disclosures of unaccounted wealth or 'black money' made over the last four months.

Officials were in touch with the CBDT chief Rani Singh Nair and revenue secretary Hasmukh Adhiya. The two were tasked with compiling the final figure of disclosures under the ambitious income disclosure scheme, the deadline for which ended on September 30.

The top income tax officials in Delhi and Mumbai were on the job well past midnight. They had to finalise the details of the quantum of declaration well ahead of Finance Minister Arun Jaitley's 3 pm Saturday news conference.

Even with two hours to go for the voluntary disclosure window to close, the declaration process barrelled on.

Meeting Targets

The last 24 hours were hectic but had brought a huge sense of relief for tax officials.

The apprehension in Delhi was whether the pan-India declarations would cross the score of the 1997 Voluntary Disclosure of Income Scheme (VDIS) launched by P Chidambaram, who was Prime Minister HD Deve Gowda's Finance Minister.

By the looks of it, the mission was going to be a success. 

The VDIS scheme had generated Rs 33,000 crore in declarations by over 4 lakh entities. In comparison, only about 644 declarations worth Rs 4,164 crore were made under the black money window for foreign assets last year, resulting in tax collection of only Rs 2,428 crore. The NDA government had to face nationwide ridicule over the poor response.

In Delhi, sources said that the final tally could touch Rs 70,000 crore - twice as much as VDIS. Since the scheme invites 45 per cent tax, the total income for the government from the scheme could be in the excess of Rs 31,500 crore. 

If compared to the catch from 1997 scheme, when the centre and states (with 75 per cent share) earned over Rs 9,500 crore in taxes and penalty over a six-months-long compliance period, that the declarations time crossed expectations, most top tax officials said.

Sources say, the final picture will be clear later, but by late evening on Friday, Hyderabad was emerging as the city with highest declarations followed by Mumbai, Delhi and Kolkata. The declarations of each major city ranged between Rs 14,000 crore to 4,000 crore a source said. 

"The disclosures lasted four months starting June 1, 2016. The government knows this is not a clean-up exercise. All those who have black money aren't going to jump forward and come clean. Nation is by no yardstick going to be free of black money. But yes many are going to declare part of their stash," a top finance ministry official.

Rush To Declare

The government had taken pains to publicise the scheme. Publicity locations at prominent spots like airports and malls were booked. The department had generated a large data bank of those who may possess assets for which they haven't paid taxes. Based on this, nine lakh letters were sent out. 

The government is keen to declare the scheme a success especially due to the ruling BJP's "war against black money" chant during Lok Sabha polls in 2014.

At the Minto Road branch of the income tax department, there were separate counters for businessmen, private salaried persons, and government employees. Over the last few days, the first section saw the maximum number of people queuing up to avail the scheme. The queues were the highest on the last day.

A senior official at a centre said, "Compared to over 4 lakh declarations in 1997, this time the figure many be higher but the number of people who walked up to the counter may even be lesser as unlike in the 1997 VDIS, this time the option of online declarations makes it easy for people to file without physically coming to a centre."

A commissioner of income tax at another centre said, "On the last day, the maximum declarants were those who had problems filing online or with their physical documentation."

For government officials battling to tame a sea of forms, even at 10 pm, there was no time for a proper dinner. Food packets with Chinese fare were laid out on work tables. Forks in hand, eating noodles, officials scrutinised forms.

At this centre, officials worked on several floors. The queue had some old ex-government officials as well even some in their twenties - busy on their smartphones waiting for their turn.

Since the disclosure scheme offers anonymity, many used proxy representatives to file their declarations.

Taking out his earphone, a young man said, "I am doing my accountants' course and I represent a client of the company I work for."

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