Cabinet approves I-T amendments to tax deposits post Nov 8: Srcs

The Cabinet is likely to have approved amendments to the income tax laws to tax deposits made after November 8 and CNBC-TV18 learns from sources that a tax rate higher than 45 percent on 'suspicious' or unaccounted deposits is a possibility.

It must be noted that income disclosed under the Income Declaration Scheme was taxed at 45 percent. To be fair to people who disclosed money under IDS it was only imperative the money now being deposited under the demonetisation drive be taxed at a rate higher than 45 percent.

The tax rate under demonetisation scheme could be as high as 60-65 percent or a combination of the normal 30 percent tax plus another 60 percent to be imposed as penalty, sources say. The laws will also be amended to make penalty legally tenable.   

However, the government may choose to avoid any formal announcements on the amendments and table it directly in the Parliament.Dinesh Kanabar, CEO of Dhruva Advisors and Alok Agrawal, Senior Director at Deloitte shared their views on the amendments. Watch video for more...