Black money – that unaccounted, illegally earned money, and on which tax is not paid – is perpetually in the news. CBI estimates that Indians have stashed some $500 billion in foreign banks; wikipedia cites a source which estimates it to be around $1.5 trillion.
For many years this issue of black money has been raised, but it has grown shriller thanks to Baba Ramdev. He is championing the movement to ‘bring back’ all the black money stashed in Swiss banks and elsewhere.
His plea is now endorsed by many political parties including allies of ruling UPA. BJP president even touched Baba’s feet (say, physical exercise, not fiscal). Saffron brigade.
This is hypocrisy at its best. It is also a ploy to divert attention of the people from some of domestic ‘safe havens’ of black money.
Bringing back black money, or exposing the owners of that money is a good thing to do, but why do we always neglect the source of the problem?
Politicians and businessmen – whose nexus is one of the major contributing factors for the problem is always swept under the carpet. This is done by forming new alliance to champion the very cause of which they themselves are perpetrators.
Illegally gained wealth is hidden in two safest places – one, in Swiss banks, and other, in religious ashrams, mutts, or in temples, homes of politicians, and also in some NGOs.
Baba Ramdev is selectively blind to the second source. I firmly believe that more money is hidden in these places within our country than anywhere else.
These mutts or ashrams are secretively managed, accountable to none, and are politically very powerful. The heads of these institutions patronize politicians based on caste and community. In return these politicians use these institutions to garner votes, and also to keep their money safe.
Many institutions have done tremendous charity work, but even then they must not be above law. There should be a law to monitor their activities(audit).
Baba Ramdev must also focus on this problem if he really cares about bringing black money back.
This ‘saffron money’ hidden in these institutions – if brought out and used judiciously, may help in addressing some pressing problems.
Ever wonder why so many politicians are showing their support to Ramdev?
I do.
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Bingo ! you are right. Apart from the tax havens and saffron money there are several loopholes in existing laws (most doable of the lot) that needs to be addressed. Real estate or gold is the best place to park your black money. Ask a CA, she will tell you more than 101 methods of making your black money white and white money black (this is what most CAs do in India). I have seen these methods in action myself, sadly. There is extremely strong nexus between the IRS official, businessman, tax lawyer, CA and politician. If 101 new laws come, CAs will find another 101 ways of circumventing the laws. The real reform process should begin with the people of India themselves, who are moralists more in thoughts than actions.
Very good information! Thanks, I had forgotten about real estate. I didn’t know about CA’s deep involvement also. You are right, no law can bring change unless people practice their morals, instead of rhetorics. Thanks for your comment.
You are blog (India n Issues) is going great, superb quality writing. Other day I was thinking that your blog has the potential to grow like ‘first post.com – seriously, keep up the good work.
Thank you GB
India and issues is a team effort.
” physical exercise, not fiscal” good one vinay
thanks