Income on which tax is not paid and deliberately evaded Received in cash, from underground economic activity Recipients spend it only in the underground economy Give the appearance of legitimacy through illegal money laundering
Illegal, Immortal, Antisocial Transaction Drug trafficking Weapons trading Terrorism Prostitution Selling counterfeit or stolen goods
Money is parked in a safe place Details of the client is kept secret Switzerland, Mauritius, Seychelles, Bahamas, British Virgin Islands, Bermuda, St Kitts, Cayman Islands Economy depends on Tourism and Banking
UBS Large integrated financial services company located in Switzerland Third largest in Switzerland with over 300 billion CHF of assets and 11.7 billion CHF of equity SBC merged with Union Bank of Switzerland to form UBS Largest bank in Europe & Second largest bank in the world. Headquarters in Bern
Three keys symbolizing Confidence Security Discretion
Privacy – Non-disclosure of a/c holder’s identity Low Risk – From 1505, no war, stable economy High Security
Increased tax rates in India Prevalent corruption Higher rates of return in India Feeble law enforcement and slow legal system
Country doesn’t get its legitimate revenues due to tax evasion Macro planning & Welfare measures go distorted Affects foreign exchange reserve Affects common man Causes decrease in quality of public goods & services
Higher taxation &inflation Increase criminal activities Affects real capital income & national income Difficulty in the formation of monetary & fiscal activity.
SC not satisfied in Govt’s action Special Investigation Team appointed by SC 13 member panel Headed by B P Jeevan Reddy, M P Shah
Conversion into white money Voluntarily Disclosure of Income Scheme (VDIS)
Restructuring tax system Severe punishments to errant tax officials Use electronic media and bank for money transfer Create awareness among people
Conversion of black money into white money is only a short term measure, but it is the preventive measures which can root out this evil permanently.
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