Pradhan Mantri Garib Kalyan Yojana (PMGKY)
- The Pradhan Mantri Garib Kalyan Yojana (PMGKY) is Union Government’s second income disclosure scheme (IDS) to allow tax evaders to come clean with unaccounted wealth.
- (PMGKY) notified along with other provisions of Taxation Laws (Second Amendment) Act, 2016 came into effect from 17 December 2016 and it will remain open until 31 March, 2017.
- It provides for 50% tax and surcharge on declarations of unaccounted cash deposited in banks.
- The recently launched Garib Kalyan yojana, is similar to Income tax declaration scheme, however there are few differences.
- Under this scheme, tax rate will be higher and the declared income.
- The declarant under this regime shall be required to pay tax @ 30% of the undisclosed income, and penalty @10% of the undisclosed income.
- Further, a surcharge to be called ‘Pradhan Mantri Garib Kalyan Cess’ @33% of tax is also proposed to be levied.
- In addition to tax, surcharge and penalty (totaling to approximately 50%), the declarant shall have to deposit 25% of undisclosed income in a Deposit Scheme which will be refunded only after 4 years without any interest to be notified by the RBI under the ‘Pradhan Mantri Garib Kalyan Deposit Scheme, 2016’.
- This amount is proposed to be utilised for the schemes of irrigation, housing, toilets, infrastructure, primary education, primary health, livelihood, etc., so that there is justice and equality.