India’s finance minister, Arun Jaitley, announced the results of the one-time scheme, which ran from June until last Friday.
The programme offered protections and immunity for those who came forward in return for a 45% levy on their newly disclosed wealth.
The government could raise around $4.4bn from the 64,275 declarations that were received under the four-month amnesty initiative, which will be used for public welfare.
India’s prime minister, Narendra Modi, had vowed to recoup billions of what is known in India as “black money” during his 2014 election campaign. In a tweet last week, he praised the outcome of the initiative.
I compliment all those who chose to be tax compliant in IDS-2016. This is a great contribution towards transparency & growth of the economy.
— Narendra Modi (@narendramodi) 1 October 2016
Tax evasion in India is a huge problem. Recent data for the 2012/13 fiscal year revealed that of India’s population of 1.3 billion, only around 1% paid tax.
Also, the value of black money stashed in foreign tax havens is suspected to be huge. Estimates vary, but in 2012, the India’s Central Bureau of Investigation put the figure at $500bn – more than any other country.
In 2014, tax made up just 2.4% of India’s GDP.
Under the scheme, the Indian government contacted over 700,000 suspected tax evaders, urging them to come clean and promising they would not be pursued by the authorities if they complied within the four-month window.
The Indian government came under additional pressure to crack down on tax avoidance and evasion after the Panama Papers named around 500 wealthy Indians hiding their wealth offshore.
