In Chapter III of Second SIT report, the SIT has recommended as under:
“Financial Action Task Force (FATF) on money laundering recommends ‘tax crimes’ to be made a predicate offence so that action can be taken under Prevention of Money Laundering Act, 2002. There are more than 25 countries in the world which have made ‘tax crimes’ as a predicate offence. The Government needs to seriously examine the issue and take steps to make ‘tax crimes’ as a predicate offence. To prevent any hardship to salaried or small tax payer, a high threshold of say, more than Rs. 50 lakh of tax evasion could be considered as being a predicate offence”.
This was stated by Shri Jayant Sinha, Minister of State in Ministry of Finance in written reply to a question in the Rajya Sabha.
Tax Evasion already attracts prosecution under the relevant tax law. That apart there are provisions for demand of tax with interest and imposition of stiff penalties. It needs to be seen as to what would be treated as an offence under the money laundering law.