Squeeze parallel economy in a fair manner: Finance Minister to taxmen

New Delhi: Finance Minister Arun Jaitley today asked taxmen to squeeze parallel economy in a fair manner, without being harsh, and assured that the honest taxpayers have nothing to fear about the new black money law. “The parallel economy has to be squeezed and (it) has to be done in very fair manner, not in a harsh manner. In doing so, as senior officers you have to maintain the highest standard of integrity,” he said while addressing a conference of top officials of the Central Board of Direct Taxes (CBDT).

The government, the minister said, has taken a host of measures to curb the menace of black money. These include passage of the black money law by Parliament and introduction of Benami Transactions (Prohibition) bill to deal with unaccounted domestic wealth. He further said that improvement in tax collection will increase the ability of the government to step up spending on social and infrastructure projects and provide relief to individual taxpayers.

For the current financial year, the minister said, direct tax collection was likely to improve by 14-15 per cent and there was possibility of the government improving upon the fiscal deficit target of 3.9 per cent. However, he added that the government would prefer to increase expenditure on social sector schemes instead of improving its fiscal deficit target.

On the new black money law which seeks to bring back the illicit funds stashed abroad, Jaitley said, “No honest taxpayer has anything to fear. It’s targeted only against those who have stashed assets abroad.” “Black money has to be squeezed”, he said, adding only those who have defied the system in the past and intend to defy the compliance window to come clean have to worry.