The Nirmala Sitharaman led Finance Ministry has withdrawn an Income Tax exemption granted to the Rs 1.3 crore prize money of Seoul peace prize won by Prime Minister Modi after he wrote to the ministry stating that he wished to pay tax like every other taxpayer in the country, Economic Times has reported.
Back in March the Central Bureau of Direct Taxes (CBDT) had exempted the prize money from taxation under the section 10 (17A) (i) of the Income Tax act.
Following this, Prime Minister Modi in a 11 August letter to Sitharaman wrote, “I wish to request you that this prize money should be subjected to the same income tax provisions that are applicable to crores of other tax-payers in the country”.
He added that the proceeds from Income Tax collections go towards nation building and urged the withdrawal of the exemption. As a result the CBDT issued an order dated 14 August announcing that following the Prime Minister’s request the prize money would be subject to regular assessment under Income Tax laws.