2. What is black money
o Black money may be defined as the money
that is generated by activities that are kept
secret in the sense that these are not
reported to the authorities. As this money is
also not accounted to the fiscal authorities
i.e. the taxes are not paid on this money.
White money is that money which is shown
in relevant accounts and tax paid ,if due
3. SOURCES OF GENERATION OF BLACK
MONEY
o Beginning of the evil
o Tax structure
o Control and licensing system
o Donation to political parties
o Ineffective enforcement of tax laws
o Generation of black money in the public
sector
4. Black money in Swiss banks
o The total amount of black money deposited in
foreign banks by Indians is unknown, but one
estimate by R Vaidyanathan, a Professor of
Finance, estimated the total at over Rs
7,280,000 Crores
o While official numbers are not available, Swiss
banking officials have said that the largest
depositors of illegal foreign money in
Switzerland are Indian
5.
6. Indian Black money stastics
If go into the deeper statistics of Indian
black money which has proof it looks like
this:
Year Black money
1990-2000 4.1lak crores
2006-2007 9.6lak crores
Present 15lak crores
7. (contd….)
o The shown above statistics are the black
money which is in Switzerland.
o This way Indian black money are stored in
almost 40 other countries.
o Recent survey shows that as much as 50lak
crores black money crossed the borders of
India in last 5 years.
8. Impact of black money
o Leads to misdirection of precious national
resources
o Worsened income distribution
o Big sized unreported segment of the economy
o Transfer of funds from India to foreign countries
o New black money culture in business world
o Corruption in the society
Last but not the least…….
o Corruption of the entire political scenario
10. Proposal to prevent Black money
The following Government institutes have been
approved in March, 2011 for conducting separate
studies on black money:
o National Institute of Public Finance and
Policy(NIPFP);
o National Institute of Financial Management(NIFM);
and
o National Council of Applied Economic Research
(NCAER).
11. (contd…..)
Government has formulated a five pronged strategy to
tackle the menace of black money which is as below:
o Joining the global crusade against black money,
o Creating an appropriate legislative framework,
o Setting up institutions for dealing with illicit Funds,
o Developing systems for implementation (new
manpower policy); and
o Imparting skills to the manpower for effective action
(constant training for skill development).
12. If Black Money is brought back in India
o Some surveys show that the black money which went out of India
in last 2 years is as much as 13 times of India’s debts.
o If the total black money is brought back to India then we can do
many wonders such as:- we can clear India’s debt in one go.
o we can clear the poor farmers of their debts.
world class roads can be laid all over India.
o We can get relief from the power shortage.
o We can see that every house in the country with current.
o We can have water supply for all the rural areas
o We can construct planned houses for 10 crore people
o We can distribute 4 crore to 6 lakh villages for their development
13. Conclusion
o In a book written by an Indian Mr.Arun Kumar, said that the
black money is around 40% of the Indian GDP.
o The Indian GDP is around Rs 61,64,000 crore that means the
black money is around Rs 25,00,000 crore.
o If the black money is declared legal and shown in the books
of accounts then the 30% of it will be taken as tax so as
much as Rs 7,50,000 crore will come as revenue.
o That will more than the total tax collection for the year.
2009-10 which stands at Rs 6,41,000 crore
o But it is not legal so none is going to declare it as legal
because they will be behind bars.
o If it has to happen this should be another movie.
