mumbai sources stated that the drive to tax ‘stateless persons’ could fast become a cat and mouse game between the government and many NRIs. As the implications of the proposed law sink in, there is a creeping fear that from next year the income tax department will question NRIs on ‘unrealistic’ overseas earnings.
Since a decade, particularly, after the passage of the Black Money Act in 2015, several indians became nri to generate fake overseas income such as trading profits, consultancy fee, and fat salaries to legitimise undisclosed funds stashed abroad. Such people will be in a spot as they may have to justify their income.
The government’s press release issued a day after the Budget, assuring that ‘bona fide workers’ will not be taxed on what they earn abroad is a veiled hint to other NRIs that have to justify their bloated overseas income. Till now the tax office has not taken such a stand. According to the Finance Bill 2020, any indian citizen who is not liable to tax in any other country or territory shall be deemed to be resident in India.