Govt announces five–pronged strategy to track black money -Governance Now

Govt announces five–pronged strategy to track black money

Pranab said government has nothing to hide on the black money

Trithesh Nandan | January 25, 2011

With the government having recently faced SC and opposition ire for not doing enough on the disclosure of the black money, finance minister Pranab Mukherjee on Tuesday announced the setting up of a multidisciplinary committee and a five–pronged strategy to track black money.

“The committee will submit it report as soon as possible,” Mukherjee said at the press conference.

“It will set up eight more overseas units. The government has appointed a group to look into the possibility of amnesty scheme to bring out black money. Moreover, the direct taxes code has provisions to check black money,” the minister said.

He said that government has nothing to hide about black money. He quoted the Global Financial Integrity (GFI), a Washington-based think-tank figure released in November saying that graft has cost India $462 billion (about Rs 20.8 trillion) between 1948 and 2008, which Governance Now also reported. “This figure is based on assumption,” he added.

The finance minister also claimed that the government has no reliable estimate of the total black money Indians have, saying that it could be between $500 billion to $1400 billion. “We have detected undisclosed income of Rs15,000 crores in the last 18 months,” Mukherjee told reporters in New Delhi.

The supreme court last week had castigated the governmnent over its inaction on the issue of slush funds of Indians. “India has started receiving information of Indians who have generated income outside the country under double taxation avoidance agreements,” he said.

“No information can be made available unless there is legal framework and no sovereign country is going to share information on black money. There is a way to get information when Income Tax authorities decide to prosecute offenders,” he said adding that sharing of information would be a violation of international norms.

However, he added that the government is committed to bring back the black money. “Swiss banks have been persistently refusing to divulge information on black money,” he said.

“We have also completed double taxation avoidance agreement with 23 countries,” It has also formulated 10 agreements on sharing data on black money. Moreover, the government has started talks with 65 nations for exchange of black money information.

Another figure released last week by the GFI pinned India’s losses due to outflow of illicit liquidity at $104.1 billion during the period 2000-2008, a period when India’s economic liberalisation was gaining pace.

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