The Centre and states are finalising three Goods and Services Tax (GST) legislations -- CGST, IGST and compensation law -- which are to be introduced in the ongoing Parliament session, which ends on December 16.
Explaining the urgency to pass the Income Tax Second Amendment Bill, the source said the purpose of it was to ensure the black money money enters the formal banking system.
"The predominant purpose of the PMGKY scheme is to use the proceeds for benefit of the poor. The political purpose is to impose exemplary tax on black money and then bring it back into the system," the source added.
Amending the IT Act, the government has brought in a new scheme Pradhan Mantri Garib Kalyan Yojana (PMGKY) under which black money will be taxed at 50 per cent. Besides, 25 per cent of the money will be kept locked in for 4 years without any interest.
If people do not disclose under PMGKY and do so with the IT department afterwards, the amendment to the Act provides that they will have to pay 75 per cent tax. But if the assessing officer catches the assessee holding black the money, then the penalty will go up to 85 per cent.
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