Friday, November 19, 2010

Black money trail: 'India drained of Rs 20 lakh crore during 1948-2008

Given the rampant looting of public funds in our country, it is hardly surprising that money amounting to half-a-trillion dollars has illegally flowed out of the country since 1948.This money is indeed the product of corruption, bribery, kickbacks, criminal activities and tax evasions, as pointed out by the Global Financial Integrity.

The government has not demonstrated any great urgency to go after the crooks and bring back at least part of the money. While international collaboration is urgently called for to check cross-border flow of black money, national governments must do their part by reforming domestic laws and strengthening enforcement.

 It is alarming to note that a substantial chunk of GDP, which could have been used for paying our external debts, alleviating poverty and developing our economy, has been stashed away in foreign countries.

Was not the country given to understand time and again, by our India Shining brigade, that the extermination of the licence raj regulatory mechanisms and reduction of taxes for the rich would eliminate the parallel economy by dis-incentivising tax evasion? Why has the magic theory of lesser-the-taxes-higher-the-taxpayer-compliance worked in the reverse direction?

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