CBDT panel for amnesty scheme to bring back black money

The committee on black money, headed by the CBDT chairman, which met last week, considered among other suggestions, an Offshore Voluntary Compliance scheme on the lines of the one operated by the Internal Revenue Service in the United States

New Delhi: The government may announce an amnesty scheme for citizens having unaccounted wealth abroad and also permit taxmen to dig into income tax filings of past 16 years of suspected assesses, based on the suggestions made by a high-powered panel, reports PTI.

The committee on black money, headed by the CBDT chairman, which met last week, considered among other suggestions, an Offshore Voluntary Compliance scheme on the lines of the one operated by the Internal Revenue Service in the United States.

“We have suggested that an Offshore Voluntary Compliance scheme be brought in like in the US, whereby a person declares money kept in foreign accounts and pays the penalty on it, after which the money can be brought back into the country,” a top finance ministry official told PTI.

“We have also recommended increasing the review period of re-opening tax assessments to 16 years from six years now, but that may be only for money stashed abroad,” the official said.

Besides, the committee, which is slated to submit its report to the finance minister by 31January 2012, could also recommend changes in current laws to curb generation of black money within the country.

“A lot of black money is generated out of activities under the state’s control, like illegal mining, land deals, building construction, and in awarding contracts. We will suggest some changes in current law to tackle this menace,” the official said.

Under the Offshore Voluntary Compliance scheme, eligible taxpayers in the US who step forward do not face civil fraud and information return penalties. However, they still have to pay back taxes, interest and certain accuracy or delinquency penalties.

They can also escape criminal prosecution based on application of the revised voluntary disclosure practice.

Under the scheme in the US, eligible taxpayers have to file or amend their returns and pay interest and certain civil penalties, as well as the tax.

The interest and penalties depend on the amount of the unpaid tax liability, the years involved, whether a return was inaccurate or if a return should have been filed and was not.

Apart from the US, countries including the UK, Germany, France, Greece, Italy and Portugal also have similar voluntary disclosure schemes.

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SEBI proposes regulation for investment advisors

“While the activity of giving investment advice will be regulated under the proposed framework through an SRO, issues relating to financial products other than securities shall come under the jurisdiction of the respective sectoral regulators such as action for mis-selling, violation of code of conduct, conflict of interest, etc,” SEBI said in the concept paper

Mumbai: Market regulator Securities and Exchange Board of India (SEBI) has proposed new rules for investment advisors that will require them to be registered with a self-regulatory organisation (SRO) before undertaking such a role, reports PTI.

The proposed framework intends to regulate investment advisory services in various forms including independent financial advisors, banks, distributors and fund managers.

The proposal has been mooted by SEBI in a concept paper, floated in September last week.

“While the activity of giving investment advice will be regulated under the proposed framework through an SRO, issues relating to financial products other than securities shall come under the jurisdiction of the respective sectoral regulators such as action for mis-selling, violation of code of conduct, conflict of interest, etc,” SEBI said in the concept paper.

Persons or entities seeking registration as investment advisors shall have to obtain it from the SRO.

“The SRO formed to regulate investment advisors will be registered under the SEBI (Self Regulatory Organisation) Regulations, 2004.

“Its duties would include registering and setting minimum professional standards, including certification of investment advisors, laying down rules and regulations and enforcing those; informing and educating the investing public; setting up and administering a disputes resolution forum for investors and registered entities, etc,” SEBI said.

Entities registered with SRO will provide advice on investments in financial products or products that are traded and settled like financial products. The services will include financial advice, financial planning service and actions which would influence an investment decision.

Besides, representatives of investment advisors or their intermediaries would also be eligible.

“Investment advisors tend to call themselves by varied names viz. wealth managers, private bankers, etc. This causes much confusion as to their role and responsibility.

“Hence the regulations will provide that no person can carry on the activity of offering investment advice unless he is registered as an investment advisor under the regulations,” the SEBI paper said.

SEBI said that in case of corporate entities, eligibility criteria would include banks providing investment advisory or wealth management services and other entities representing an investment advisor.

“A person shall be deemed not to be engaged in the business of providing investment advice, if the advice is solely incidental to some other business or profession and the advice is given only to clients of the person in the course of such other business or profession...” SEBI said, adding that advocates and solicitors, chartered accountants and stock brokers, among others would be in this list.

For registration with SRO, individuals would require professional qualification like Chartered Accountancy or MBA or certification from other institutions recognised by SEBI.

In case of entities, they would need to maintain a minimum net worth which would be separate from the net worth required for other activities and should have at least two key personnel having the relevant experience exclusively for acting as investment advisors.

“The investment advisor will be responsible to maintain confidentiality of the... (and) would be required to do adequate risk profiling of the client before any investment service is provided to them,” SEBI said.

It said that records in support of every investment recommendation or transaction have to be maintained and retained for at least five years.

“Investment advisors shall not accept funds/securities from investors, except the fee for investment advice... Other than sourcing of research reports, no other part of investment advisory activity can be outsourced,” the concept paper added.

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Low turnout marks Anna’s fast

The Gandhian, who began the latest round of protest ignoring concerns over his health, asserted that the ambit of his agitation will soon be expanded to include radical electoral reforms like Right to Reject candidates

Mumbai: A surprisingly low turn-out marked the launch of social activist Anna Hazare’s three-day fast against the government’s Lokpal bill which he described as ‘betrayal’ of the people, reports PTI.

As 74-year-old Mr Hazare sat on the fast at the MMRDA ground, the estimate of people at the venue varied between 4,000 and 10,000 in sharp contrast to the 30,000-40,000 that poured in Ramlila Maidan in August.

Team Anna had said that they expected over a lakh people to turn up at the protest venue here. In Delhi too, a negligible number of protesters were at Ramlila Maidan.

Addressing the protesters, Mr Hazare vowed to continue the “fight to the finish”, warning the UPA government that he will campaign against it in the upcoming assembly elections in five states and later in the Lok Sabha polls.

The Gandhian, who began the latest round of protest ignoring concerns over his health, asserted that the ambit of his agitation will soon be expanded to include radical electoral reforms like Right to Reject candidates.

Seeking to broad base his agitation, Mr Hazare said he has invited Baba Ramdev to join his stir and the yoga guru will visit the fast venue tomorrow or the day after.

“It is going to be a long-drawn battle. The agitation for a strong Lokpal is like second war of independence and it has to be treated like that. We have to fight to the finish, even if we have to go to jail, we don't care,” MR Hazare, who looked a little under the weather but resolute as usual, said.

Accusing the government at the Centre of betraying the people, he said, “This is not betrayal of Anna Hazare or Team Anna. This is the betrayal of people who will teach you a lesson.”

Mr Hazare, who is suffering from viral infection, reaffirmed his decision to campaign against the Congress in all the five election-bound states that includes Uttar Pradesh.

“Some people are trying to threaten us. They say they will not allow us to visit (the states where polls are to be held). Those whose fear of death has died don't fear anything,” he said.

Mr Hazare said he would tour the entire country to spread awareness about the intentions of the government. “We will tell them that the nation’s treasury is under threat more from its keepers than thieves. The nation faces greater threat from traitors within than enemies outside.”

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