Black Money – Interpreted
Black money doesn’t mean counterfeited or forged currency. Instead, it means the unaccounted wealth which is earned by the individuals and the firms duping the laws of the land. According to many sociologists and accounts professionals, black money is that profit which is not recorded in the account books i.e. hidden income.
Process of Earning Black Money
Every one required to earn money by fair sources and then to pay taxes according to law. But when they adopt unfair means, or hide the income and abstain from paying taxes, the money so earned becomes black money.
Formidable Form of the Black Money
It is estimated that every year a huge amount is added to the black money that is also a large percentage of the national income. It is said that the Indian black money, if it is brought out, would be able to run the national economy without any foreign funds as well as wipe out all the debts of the Government of India.
Factors Contributing to Black Money
The black money is generated due to many reasons, main whereof are the following:
- Illegal Deals
The black money is earned by the people through hawala transactions, gifts and illegal foreign exchange deals. These deals are not scrutinized by the government as these are done without any documentary evidences.
- Foul Devices Used By Businessman
The businessmen adopt the procedures of under-billing and overbilling and exaggeration of expenses. These devices lead to the generation of black money.
- Avoiding to Pay Due Taxes
The people earn money far beyond the taxable limit, but don’t pay their taxes. Even if they pay taxes, they are not in correct proportions to their earned incomes.
- Responsibility of the Government
It is often remarked by the well known economists and industrialists that the government itself is responsible for the creation of black money. The taxes on income and wealth are so high, that an honest person will be left with little amount after he pays his due taxes.
- Assets : Sale and Purchase of
The common practice is that the price of the property is shown to be very low in the documents. We often learn through newspapers that property of worth crores of rupees was sold for only a few lakhs or less than that.
(5) Remedial Measures
The government has taken various steps to control the black money problem. Some of them are as under :
- VDIS : Under The Voluntary Disclosure of Income Scheme (VDIS) the people in great number declared their black incomes and deposited 30% of the same with the Government. The remaining 70% was retained by them as the respectable part of their earned incomes.
- Legal Steps Pressurising : Black marketers, the hoarders, businessman and individuals are being forced by the government for bring out the ‘black’ facts and figures.
- Implementation of New Tax Schemes : The government is trying to bring most of the people under the tax net. It has started Kar Samadhan, and one out of six Schemes. Under the latter scheme every person, who has fulfilled any of the six criteria of asset is bound to fill up Form 2C and file the return through the proper form.
- On 8 November, 2016, government of India announced to demonetize the Rs. 1000 and Rs. 500 currency notes from the midnight. It was considered to be the largest step taken by the Indian Government in order to take control over black money.
Finally, in order to conclude, we must bear in our mind that we earn money, doesn’t matter more or less, being an honest citizen of the country. Hence, it is our duty to pay taxes as per law honestly.
