Arun Jaitley said the PMGKY was not an isolated scheme launched in 2016 and the response to PMGKY should not be seen in isolation.
New Delhi: The Centre on Thursday said that blackmoney amnesty scheme — Pradhan Mantri Garib Kalyan Yojana — launched during demonetisation “did not generate good response” with people declaring only Rs 5,000 crore of illicit wealth.
Offering a last chance to black money holders, the Modi government had come out with the amnesty scheme in December 2016 at the time of demonetisation. The scheme had closed on 31st March 2017.
“The response has not been so good. It is around Rs 5,000 crore of income which has been declared under PMGKY,” said Revenue secretary Hasmukh Adhia.
He said that reasons for poor response was that even before Pradhan Mantri Garib Kalyan Yojana was announced people had tried to put cash in different accounts and tax, penalty and provision to keep 25 per cent money in interest free deposit under the scheme was considered high.
Under PMGKY, people could come clean by paying 50 per cent tax and had to lock in 25 per cent of the total declared funds in interest free bonds for four years.
However, Union finance minister Arun Jaitley said the PMGKY was not an isolated scheme launched in 2016 and the response to PMGKY should not be seen in isolation.
“You first had the IDS ( Income Declaration Scheme), then you had people depositing cash in banking system knowing it would incur a tax liability and PMGKY was over and above that. When you look at the total amount of disclosures made, you have to look at all three of them collectively,” said the finance minister.
He said that demonetisation was a big step to bring down shadow economy. Finance minister said that due to measures against blackmoney there is a greater move towards digitisation. “Tax payer base itself has increased. This is apparent for the fact that during 2016-17 the (tax) revenue increase has been 18 percent,” said Mr Jaitley.
PMGKY was launched by the Modi government during demonetisation to encourage people to declare blackmoney and not use illegal ways to deposit their untaxed cash in banks.
Under Income Disclosure Scheme (IDS) launched between June-September 2016 around Rs 67,382 crore worth blackmoney was declared.