Plug tax loopholes to unearth black money
The BJP-led Government’s dilly dallying in making public the names of Indians stashing their ill-gotten cash in tax havens offshore is a shocking U-turn from the position adopted by party leaders, including Prime Minister Narendra Modi, in their campaign for Lok Sabha elections. However, the Supreme Court’s recent direction to the Centre to complete the prosecution of black money hoarders abroad under the Income Tax Act, 1961 by March 31, 2015 is a silver lining in the cloud.
A buzz is doing rounds in power circles that the Government is hesitating to reveal the names of tax defaulters as the list of 627 Indians holding foreign bank accounts which the Centre had submitted to the apex court contains the names of some influential businessmen who are close to the top leadership of all the major political parties.
Many countries have already extended their hand to India in her hunt for black money. With Bureaucracy Today emerging as an influential opinion maker, the Government of Mauritius trusted us as the medium to get its position on black money conveyed to those concerned. Our Cover Story discusses in detail how the Mauritius Government is aiding India in its fight against black money.
The Government and the Opposition must realise that politicising the debate on black money won’t help them and they can no longer hoodwink the public on the issue. Unearthing black money is a serious matter and needs utmost attention. It was high time the Government renegotiated its treaties with other countries that have caused severe problems for Indias attempts to control the menace of black money. The tax avoidance treaties with countries like Mauritius which are allegedly being used by businessmen to evade Indian tax authorities and round-trip their illicit money need to be relooked at. It is time the Government told Foreign Institutional Investors (FIIs) that the era of anonymity is over.
If the Indian Government is really serious about bringing back the black money stashed in overseas banks, it must not stop at seeking the help of an SIT. The effective strategy must be to close tax loopholes and end round-tripping. And to do that, financial reform is required which will end the era of tax havens.
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