India Govt for TDS on property sale, gold buy to check black money

New Delhi, Mar 16 (PTI) To check the menace of black money in the country, the Indian government today proposed a slew of measures, including reassessment of income tax returns up to 16 years with regard to assets held abroad and tax deduction at source (TDS) on transfer of immovable property and gold purchase. "I propose a series of measures to deter the generation and use of unaccounted money," Finance Minister Pranab Mukherjee said in Lok Sabha, lower house of Parliament, while presenting the Budget for the 2012-13 fiscal beginning April 1. The government plans tax deduction at source on transfer of immovable property (other than agricultural land) above a specified threshold, he said. Mukherjee also said he proposed to introduce a General Anti Avoidance Rule (GAAR) in order to "counter aggressive tax avoidance schemes, while ensuring that it is used only in appropriate cases, by enabling a review by a GAAR panel". The minister also said he proposed to lay on the table of the House a White Paper on black money in the current session of Parliament. Besides, the Budget also proposes compulsory reporting requirement in case of assets held abroad and tax collection at source on trading in coal, lignite and iron ore. Government also plans tax collection at source on cash purchase of bullion or jewellery in excess of Rupees 200,000 (USD 4000). It has also been proposed to "increase the onus of proof on closely-held companies for funds received from shareholders as well as taxing share premium in excess of fair market value". Mukherjee proposed taxation of unexplained money, credits, investments, expenditures "at the highest rate of 30 per cent irrespective of the slab of income". The government also plans allowing Income Tax authorities to reopen assessment cases up to 16 years in relation to assets held abroad. Mukherjee also proposed a system of Advance Pricing Agreement (APA) to significantly bring down tax litigation and provide tax certainty to foreign investors. He said this was relevant in a globalised economy with expanding cross-border production chains and growing trade within entities of the same group. "Though, the provision for APA has been included in the DTC (Direct Taxes Code) Bill, 2010, I propose to bring forward its implementation by introducing it in the Finance Bill, 2012, he said. PTI