Unaccounted gold above a certain threshold may account for heavy tax

To curb black money, the Narendra Modi government will soon announce an amnesty scheme for unaccounted gold. Individuals will be allowed to disclose unaccounted gold and beyond a certain threshold will have to pay taxes.

According to the source, this holding limit will be fixed under the scheme. Once the scheme is closed, heavy fines will be imposed on those holding unaccounted gold beyond the prescribed limit. Along the lines of the income tax amnesty scheme, the gold amnesty scheme would also be on the table for a limited time period. Gold jewellery of married women below a certain amount will be exempted from this scheme.

The proposal was reportedly jointly prepared by the Department of Economic Affairs and the Department of Revenue. A ‘Gold Board’ will be set up with representatives from the government and private sector most likely this fiscal and will annually tweak proposals to keep the schemes attractive for buyers and develop gold holdings into a financial asset.

Along with it the existing Sovereign Gold Bond Scheme will be revamped to make it more attractive to buyers.The government’s Sovereign Bond Scheme allows individuals and Hindu Undivided Families (HUFs) to buy up to four kg of gold in demat form. Trusts are allowed to purchase 20 kg of gold. The scheme bears an annual coupon of 2.5 percent and is redeemed at the market value of gold on maturity.