Union Budget 2011: More talk about black money, little will to get the money back
Moneylife Digital Team 28 February 2011

Six paragraphs of the finance minister’s Union Budget speech were devoted to legislation and other steps to tackle corruption. Crusaders don’t believe the government has the will to follow cases to the end

Following a year of national outrage over scams and the repeated raps from the Supreme Court about being ineffective in dealing with black money, the government decided to devote six paragraphs in the Union Budget text to this issue. But how much will come out of it? According to crusaders against tax evasion, all these talks boil down to zilch.

"I am happy that the finance minister thought the issue important enough to mention it in the Union Budget," said eminent chartered accountant MR Venkatesh, who has been at the forefront of the battle against tax evasion. "But how much do you take away from all that philosophical talk? Nothing."

Today, finance minister Pranab Mukherjee announced that India, being concerned about the issue, has adopted a five-pronged strategy to tackle it. It has also become a member of several international financial task forces and anti-corruption drives and signed many tax information exchange agreements with many nations and agencies. The minister mentioned that 2009 amendment to the legislation on money laundering was successful and some 1,200 cases had been registered under this law in two years.

KVM Pai, former chief income tax commissioner, has petitioned the Supreme Court on amnesty proposals to retrieve tax information from evaders after the prime minister's office and the Central Board of Direct Taxes refused to answer him. He said that the government is deliberately avoiding the issue.

"How does it matter what commissions we have joined? Where is the money? Has any move been made to recover it? The government is silent," Mr Pai said, after hearing the finance minister's Budget speech. "At the cost of penalty, everyone must give details of transactions with both foreign and domestic banks. That information can be used to retrieve the money." Mr Pai mentioned that much money is also stashed away in banks in the US and the UK, from where information can be easily obtained.

Mr Venkatesh echoed these thoughts and said, "All this philosophical talk that the minister gave about his strategy and noble intensions is nothing new. India should immediately ratify the UN Convention Against Corruption. We don't require more laws, what we need is political will."

It should be noted that while the minister said that the number of cases registered against money laundering has gone up, he did not comment on how many of these cases had been followed through or solved. No announcements were made about retrieving the money stored in tax havens.

Mr Venkatesh said, "Money Laundering legislation is a very draconian legislation. A charge can be slapped on anyone. In most cases, these have been applied to common people. However, the crooks are roaming free. The government is actually aiding them, and not the aam aadmi who it boasts it is working for."

1 decade ago
Politicians should have will to bring back black money. Let bygones be bygones but atleast in future there must be regulation to stop generation of black money.Laws should be so stringent that no body could think to get involved in black money dealings. All the Politicians,executives,Judges and individuals should submit total list of property held with the details the method it is acquired in annually on internet.
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