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Consider the following statements regarding the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015:
- Undisclosed foreign income or assets shall be taxed at a flat rate of 30 percent under the Act.
- There are also prosecution provisions under the Act.
Which of the statements given above is/are correct?
- a)1 only
- b)2 only
- c)Both 1 and 2
- d)Neither 1 nor 2
Correct answer is option 'C'. Can you explain this answer?
Most Upvoted Answer
Consider the following statements regarding the Black Money (Undisclos...
Statement 1: Undisclosed foreign income or assets shall be taxed at a flat rate of 30 percent under the Act.
The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 is an Indian legislation aimed at curbing black money and undisclosed foreign income and assets. Under this Act, any undisclosed foreign income or assets are subject to taxation.
The Act specifies that undisclosed foreign income or assets shall be taxed at a flat rate of 30 percent. This means that regardless of the amount or nature of the undisclosed income or assets, a fixed rate of 30 percent tax is imposed on them. This provision ensures a uniform tax rate for all undisclosed foreign income and assets, simplifying the tax calculation process.
Statement 2: There are also prosecution provisions under the Act.
In addition to taxation, the Act also includes provisions for prosecution. These provisions empower the authorities to take legal action against individuals who have undisclosed foreign income or assets. The Act allows for the initiation of prosecution proceedings in cases where tax evasion is detected.
The prosecution provisions of the Act aim to deter individuals from engaging in tax evasion and undisclosed foreign transactions. By imposing penalties and potential legal consequences, the Act serves as a deterrent and encourages compliance with tax laws.
Explanation:
Both statements 1 and 2 are correct. The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 imposes a flat rate of 30 percent tax on undisclosed foreign income or assets. Additionally, the Act includes provisions for prosecution, allowing legal action to be taken against individuals involved in tax evasion and undisclosed foreign transactions.
Therefore, the correct answer is option 'C' - Both 1 and 2.
The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 is an Indian legislation aimed at curbing black money and undisclosed foreign income and assets. Under this Act, any undisclosed foreign income or assets are subject to taxation.
The Act specifies that undisclosed foreign income or assets shall be taxed at a flat rate of 30 percent. This means that regardless of the amount or nature of the undisclosed income or assets, a fixed rate of 30 percent tax is imposed on them. This provision ensures a uniform tax rate for all undisclosed foreign income and assets, simplifying the tax calculation process.
Statement 2: There are also prosecution provisions under the Act.
In addition to taxation, the Act also includes provisions for prosecution. These provisions empower the authorities to take legal action against individuals who have undisclosed foreign income or assets. The Act allows for the initiation of prosecution proceedings in cases where tax evasion is detected.
The prosecution provisions of the Act aim to deter individuals from engaging in tax evasion and undisclosed foreign transactions. By imposing penalties and potential legal consequences, the Act serves as a deterrent and encourages compliance with tax laws.
Explanation:
Both statements 1 and 2 are correct. The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 imposes a flat rate of 30 percent tax on undisclosed foreign income or assets. Additionally, the Act includes provisions for prosecution, allowing legal action to be taken against individuals involved in tax evasion and undisclosed foreign transactions.
Therefore, the correct answer is option 'C' - Both 1 and 2.
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Consider the following statements regarding the Black Money (Undisclos...
The Ministry of Finance recently informed that the Income Tax Department has raised tax demands worth Rs 13,566 crore under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act over the last four years.
About Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015:
- Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, or the Black Money Act (as popularly known), has come into force w.e.f. 01.07.2015.
- Objective: To create a deterring effect on illegal foreign transactions and bring back undisclosed Indian money abroad.
- Features of the Act:
- Applicability:
- The Act will apply to all person resident in India.
- It will also apply to a person being Not an ordinary resident or Non-resident but who was an ordinary resident of India during the previous year when undisclosed income was earned or assets acquired outside India.
- Provisions of the Act will apply to both undisclosed foreign income and assets (including financial interest in any entity).
- Tax:
- Undisclosed foreign income or assets shall be taxed at a flat rate of 30 percent.
- No deductions, exemptions, carry forward, or set-off shall be available while computing tax liability under the BM Act, unlike the Income Tax Act.
- Penalties:
- The penalty for non-disclosure of income or an asset located outside India will be equal to three times the amount of tax payable thereon, i.e., 90 percent of the undisclosed income or the value of the undisclosed asset. This is in addition to the tax payable at 30%.
- There are other penalties also leviable on account of non-disclosure of required information etc., and there are prosecution provisions also within the Act.
- One-time compliance opportunity:
- The Act also provides a one-time compliance opportunity for a limited period to persons who have any undisclosed foreign assets which have hitherto not been disclosed for the purposes of Income-tax.
- Such persons may file a declaration before the specified tax authority within a specified period, followed by payment of tax at the rate of 30 percent and an equal amount by way of penalty.
- Such persons will not be prosecuted under the stringent provisions of the Act.
Hence both statements are correct.
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Consider the following statements regarding the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015: Undisclosed foreign income or assets shall be taxed at a flat rate of 30 percent under the Act. There are also prosecution provisions under the Act.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer?
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Consider the following statements regarding the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015: Undisclosed foreign income or assets shall be taxed at a flat rate of 30 percent under the Act. There are also prosecution provisions under the Act.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer? for UPSC 2025 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about Consider the following statements regarding the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015: Undisclosed foreign income or assets shall be taxed at a flat rate of 30 percent under the Act. There are also prosecution provisions under the Act.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer? covers all topics & solutions for UPSC 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Consider the following statements regarding the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015: Undisclosed foreign income or assets shall be taxed at a flat rate of 30 percent under the Act. There are also prosecution provisions under the Act.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer?.
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