As a number of States go to polls starting with Gujarat later this year, the government is set to notify the electoral bond scheme.
According to government officials, the Central Board of Direct Taxes has already drafted the contours of the scheme. “Over the next two-three weeks, the Electoral Bonds scheme is likely to be notified,” said an official.
A final round of discussions between the Finance Ministry, the Reserve Bank of India and the Election Commission is expected. It is likely to be notified by the month end.
Announced by Finance Minister Arun Jaitley in the Union Budget 2017-18, the government hopes that the scheme will bring in transparency into political funding.
Sources said its contours are largely in line with the Budget proposal under which donations over ₹2,000 to political parties will be through these bonds.
Donors would be expected to purchase the bonds from designated branches of only a few authorised banks.
Every recognised political party would also register one designated bank account in which all such bonds would be redeemable.
It is likely that the bonds would be redeemable within a six-month period, although the time frame may be revised when the scheme is finalised.
To ensure that only clean money goes into political funding, the purchase of bonds would be through cheque or electronic means.
The Finance Ministry is also hopeful that the process would be quite simple, akin to investment schemes like the sovereign gold bonds.
The Budget had termed it as a reform measure that will “bring about greater transparency and accountability in political funding and prevent future generation of black money”.
But, civil society activists as well as the Election Commission had raised concerns that it could lead to more corruption by bringing anonymity to donations as no disclosures would be expected from the donor or the political party.