The finance ministry on Thursday said that the Amended I-T Act will not apply to tax jewellery/gold purchased out of disclosed income or exempted income or reasonable household savings, reported Indian Express.
The announcement by the Central Board of Direct Taxes (CBDT) has given a major relief to the people who were anticipating that jewellery would be covered under the amended law after demonetisation of high value currency notes.
“The jewellery or gold purchased out of disclosed income or out of exempted income like agricultural income or out of reasonable household savings or legally inherited which has been acquired out of explained sources is neither chargeable to tax under the existing provisions nor under the proposed amended provisions,” the CBDT said.
The Lok Sabha on November 29 passed the Taxation Laws (2nd Amendment) Bill, 2016 that seeks to tax money deposited in banks post demonetisation.
India is the world’s second biggest gold buyer, and it is estimated that one-third of its annual demand of up to 1000 tonnes is paid for in black money – untaxed funds held in secret by citizens in cash that don’t appear in any official accounts.