Finance Minister Arun Jaitley today hinted in Lok Sabha at the government considering amending the anti-money laundering and Income Tax laws to get back the black money stashed abroad, admitting that there are weaknesses in them.
While making it clear that there was a need for tax-friendly regime with reasonable taxes, he said there was also need to put the fear of law into the offenders.
This could be done by providing for criminal prosecution and seizing of assets in India of those whose money is stashed abroad illegally so that the money comes back, he said.
Dissatisfied with the Minister's reply to the two-day debate on the black money issue, opposition Congress and TMC members walked out saying the government has failed to fulfil its promise of bringing back the black money in 100 days.
"I admit that there are weaknesses in our law... When the money is caught, we need to bring it back. I know that even SIT is worried about it. The I-T Act has no jurisdiction over those outside (India)," Jaitley said.
He said there was need for power to confiscate the assets in India of those who have been found to be in possession of black money abroad.
"This can be done through changes either in the I-T Act or money laundering act... I have studied the (prevention of) money laundering act. There are weaknesses in that also. Probably we have to change that," he said.
The Minister said the UN Convention has such a provision. "We have to strike fear of criminal prosecution in them so that their money is brought back.. We can continue the political debate on time line for bringing back the black money, but we must understand the procedures involved in it," he told members.
During the debate, Jaitley also said India was moving towards a tax-friendly regime to correct the "bad" image among investors. In the past few years, India got a bad name from the world of investment that "you are not a tax-friendly regime".
" Our tax system has to be friendly to tax payers, both procedurally and otherwise. And that is exactly what step by step we are trying to do. The taxation should be reasonable so that the government expenses are met, tax base widened and tax evaders don't have incentive.
"Those who have to pay taxes must pay taxes. We cannot allow either evasion or avoidance and those who are not liable to pay taxes, by merely raising demand, we cannot generate more taxes. Such taxes then get stuck up in courts.
