Government clarifies that not all require tax clearance certificate to Go Abroad

Source- This post on the Government clarifies that not all require tax clearance certificate to Go Abroad has been created based on the article “Not all require tax clearance certificate to go abroad: govt” published in “The Hindu” on 29 July 2024.

The government clarified a Union Budget proposal that sparked outrage over the mandatory requirement for tax clearance certificates for going abroad.

About the clarification

1. The Finance ministry clarifies that only individuals accused of financial irregularities or with significant tax arrears need tax clearance certificates.

2. The proposed amendment does not mandate all residents to obtain tax clearance certificates.

3. The amendment includes a reference to the Black Money Act, 2015, in the list of Acts requiring liability clearance for the certificate.

4.  According to a 2004 notification by the Income Tax Department:

i)  Certificates may be required in cases of serious financial irregularities.

ii) Investigations under the Income Tax or Wealth Tax Act that require a person’s presence and lead to a tax demand.

iii) Direct-tax arrears exceeding ₹10 lakh, which have not been stayed.

5. Procedural Requirement involves that a person may be asked to get the certificate only after the reasons are recorded by the department.

UPSC Syllabus: Indian Economy