Ministry vows crackdown on money laundering

03 December 2016

The government on Friday warned of tough action against those colluding with money launderers or seeking to convert black money into white and said they would not be spared.

"Trails being pursued by agencies. Coordinated action under way. Result already visible. Will be more visible in coming days," economic affairs secretary Shaktikanta Das said on micro-blogging site Twitter. "Those indulging in or colluding with money laundering or converting black money into white will not be spared," he said but did not elaborate.

His comments come after the income tax department undertook search-and-seizure operations on the houses of two government officials and two contractors in Bengaluru on Thursday, and seized Rs6 crore in unaccounted cash, including Rs5.7 crore in new Rs2,000 notes. This was the biggest seizure of cash in new currency after demonetisation was announced on 8 November.

The government has taken several steps to deter people trying to convert black money into white. Jan Dhan accounts which have shown huge deposits after the ban was announced are under watch and withdrawals have been limited to Rs10,000 a month.

The Lok Sabha on 29 November approved the Taxation Laws (2nd Amendment) Bill, 2016, which seeks to tax money deposited in banks after the government's demonetisation decision.

The bill proposes to levy a total tax, penalty and surcharge of 50 per cent on the amount deposited post-demonetisation while higher taxes and stiffer penalty of up to 85 per cent for who are caught.

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