Gold jewelry purchased by your disclosed income sources, agricultural income, legitimate savings or any sort of ancestral jewelry can be retained by you and purchased in the future WITHOUT any sort of taxes from now on.
In a rather public friendly move, the Finance Ministry and CBDT (Central Board Of Direct Taxes) made the official announcement after the much hyped amendments made to the Income Tax laws.
The Lok Sabha passed the second amendment to the Taxation Laws earlier this week and it proposed a step to impose an 85% tax penalty on illegal wealth and monetary sources, which was speculated to include gold and jewelry products as well.
But in a rather pleasing reversal, the laws have exempted gold products if they are legitimately presented to be obtained by disclosed income sources, legitimate agricultural income sources, resonable household savings over a course of time or ancestral inheritance.
This move does need further explanation for existing gold purchases in one’s household and it states the following clauses :
#1. Gold jewelry possessed by any married upto 500 gm shall not be seized or subjected to taxes.
#2. Gold jewelry possessed by any unmarried woman upto 250 gm shall not be seized or subjected to taxes.
#3. Gold jewelry possessed by any man (regardless of marital status) upto 100 gm shall not be seized or subjected to any taxes.
Furthermore, if gold jewelry UPTO ANY LIMIT which is found to be purchased by disclosed income or legitimate monetary sources in your household during search operations is fully protected and shall not be siezed or subjected to any penalty.
The Bill is currently under the cosideration of the upper house, i.e., Rajya Sabha and is the government’s move to openly target black money holders and will be looking to amend Section 115BBE of the Income Tax Act with further changes to section Section 271 AAB, which would raise the penalty of for black money holders to 85% in any sort of search and seize operations conducted by the Income Tax Department.
This step comes after the much publicised move of the government which focused on demonetisation of 500 rupee and 1000 rupee notes but the government really seems to be going with all the possible moves in its book in order to target black money on a macro scale.
Will this move be succesful in targeting black money? We surely hope so!
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