Bill to amend tax laws by Friday

The government will introduce a Bill to amend tax laws, including some provisions in the Income Tax Act, 1961, by Friday, Finance Minister P Chidambaram said today.

"I will introduce before the session is over the Tax Laws Amendment Bill by which some measures are being introduced in the Income Tax Act," the minister told the Rajya Sabha in response to a query on taxing charitable institutions.

"Some amendments are being proposed to the Income Tax Act and it will be placed before the House by Friday. It (taxing charitable institutions) is a very sensitive subject and I would like to approach it with caution," he said.

There were several organisations which supported charity through education and health care, and their incomes could be large, Chidambaram said. He, however, ruled out bringing marriage expenses in the tax ambit saying, "we have to strike a balance."

The minister said the government had made it mandatory for the registrar of property, the Reserve Bank of India and banks to report seven categories of high-value transactions.

Under the stipulation, banks will have to report under the annual information return (AIR) cash deposits of above Rs 10 lakh in a year in any savings account maintained by an individual.

Similarly, any company or institution issuing credit card, would be required to report card payments aggregating over Rs 2 lakh a year made by any person. Mutual fund managers would also have to report investments of over Rs 2 lakh under AIR, Chidambaram said.

A company or institution issuing bonds or debentures, or a company issuing shares through public or rights issue, will also have to file an AIR if investments were high.

Information on any investment aggregating more than Rs 5 lakh in a year, in bonds issued by the Reserve Bank of India, will have to be filed in the AIR by the RBI.

Chidambaram described the mandatory filing of AIR by the registrar of properties on purchase or sale by any person of immovable property valued at Rs 30 lakh or more, as an anti-black money measure.

He said the 'guideline value' fixed for a property would indicate its value.

The AIRs would be filed from 2005-06 onward and the due date for furnishing the AIR would be August 31 of every financial year.