India's Central Board of Direct Taxes has announced a new scheme under which it intends to reward informants by paying them up to Rs5 crore (US$749,232) for tax evasion tip-offs.
Previously, informers were given Rs1 lakh (US$1,498) as an instant reward if the tip-off led to tax recovery. The rest of the reward money, which amounted to 10% of the total tax liability up to a maximum cap of Rs15 lakh (US$2,2477), was based on the case’s final settlement.
But according to Taxscan, the new Income Tax Informants' Rewards Scheme 2018 means that individuals can now receive a reward of up to Rs5 crore (US$749,232) for providing specific information about evasion of tax on income and assets located in India and abroad. Informants’ identity will be kept confidential.
The information must lead to the detection of substantial tax evasion under the provisions of the Income Tax Act, 1961 and/or the Black Money (Undisclosed Foreign Income & Assets) and Imposition of Tax Act, 2015.
The new scheme will apply even if information was provided to the authorities before its start date. But it will not apply to information related to recovering irrecoverable taxes, for which the Board has issued separate guidelines.
Emma Woollacott is a freelance business journalist. Her work has appeared in a wide range of publications, including the Guardian, the Times, Forbes and the BBC.
India's Central Board of Direct Taxes has announced a new scheme under which it intends to reward informants by paying them up to Rs5 crore (US$749,232) for tax evasion tip-offs.
Previously, informers were given Rs1 lakh (US$1,498) as an instant reward if the tip-off led to tax recovery. The rest of the reward money, which amounted to 10% of the total tax liability up to a maximum cap of Rs15 lakh (US$2,2477), was based on the case’s final settlement.
But according to Taxscan, the new Income Tax Informants' Rewards Scheme 2018 means that individuals can now receive a reward of up to Rs5 crore (US$749,232) for providing specific information about evasion of tax on income and assets located in India and abroad. Informants’ identity will be kept confidential.
The information must lead to the detection of substantial tax evasion under the provisions of the Income Tax Act, 1961 and/or the Black Money (Undisclosed Foreign Income & Assets) and Imposition of Tax Act, 2015.
The new scheme will apply even if information was provided to the authorities before its start date. But it will not apply to information related to recovering irrecoverable taxes, for which the Board has issued separate guidelines.
Emma Woollacott is a freelance business journalist. Her work has appeared in a wide range of publications, including the Guardian, the Times, Forbes and the BBC.
