Category Taxation in India

Blackmoney Crackdown Boosts Taxes in India

May 4, 2017 Taxation in India

Indian RupeesNEW DELHI – By barring the use of selected bank notes, the government of India has managed to force millions of people to finally pay their taxes.

The efforts made this year by the government of India to drive down the use of black money and tax evasion have worked, with a large number of people now coming into the reach of the tax net.

Since the start of the crackdown on black money, the number of individuals who have filed tax returns has risen by approximately 9.5 million.

The tax net could even spread further, as the tax authorities are still on the lookout for taxpayers who are likely to have committed some tax evasion.

For the purposes of finding the tax evaders, the tax authority has compiled a list of 1...

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Inactive Shell Companies Getting the Boot in India

May 1, 2017 Taxation in India

Indian National FlagNEW DELHI – Dormant companies in India are being told to registered, as authorities believe they may be being used for money laundering.

Over the weekend the Ministry of Corporate Affairs of India sent out approximately 200 000 notices to companies which claim to be inoperative, instructing the entities to close down.

The notices come as a result of the recent moves by the government to demonetise selected bank notes, as they were thought to lead to money laundering and black market activity.

The companies which received notices have not filled annual returns for several years, indicating that they did not undertake any business activity.

However, during the demonetisation process it was evident that a number of “inactive” companies were actually participating in money laundering activ...

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India to Tax Downloads at 15%

November 14, 2016 Taxation in India

Service Tax on Media in IndiaNEW DELHI – Fans of music, movies, books, and other online services in India will soon see their bills jump, following the announcement of a 15 percent service tax.

Last week the government of India announced several tax changes, among them was the implementation of a tax on downloads and purchase of digital goods from offshore retailers.

Currently, purchases of digital goods and services such as online storage, movies, games, and music downloaded from a provider registered in India is liable for a service tax of 15 percent.

Downloads from foreign-registered service providers were exempt from paying the 15 percent tax, however, following the full implementation of the new rules, the exemption will be dropped.

It is expected that the application of the service charge will see an increas...

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India to Levy Fines on Cash Hoarders

November 11, 2016 Taxation in India

Fines on undeclared money in IndiaNEW DELHI – Hoarders of undeclared cash in India have been stung with hefty penalties as part of the government’s demonetization process.

On November 10th, the government of India detailed the potential penalties faced by tax evaders during the current demonetisation process.

On November 9th, the government announced that certain high-value currency notes will no longer be legal tender in India, and that there is a timeframe of 50 days in which those notes can be deposited in bank accounts, before the notes become nothing more than paper.

Under the conditions detailed in the latest announcement, individuals who deposit more than INR 2 500 may face extra scrutiny by tax officials, who will receive full records of all deposits made.

Tax authorities will also levy a fine of up to 200 perce...

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India Removes High-Value Notes from Circulation

November 9, 2016 Taxation in India

High value notes in IndiaNEW DELHI – India is hoping that removing certain high-value bank notes from circulation will help eradicate tax evasion and funding of terrorism.

At midnight on November the 8th India will drop INR 500 and INR 1 000 banknotes from circulation.

The move to withdraw the large denomination notes from circulation is intended to bring in significant levels of hidden wealth back into the formal economy.

The withdrawal is also aimed at hampering the capabilities of militant groups to fund their activities, and to undermine the capability of small businesses to evade their tax obligations.

It is believed that as much as 40 percent of the national economy of India is comprised of small- and medium-sized businesses which predominantly operate in cash, and, often, without reporting their profits to...

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