M'lore: Good Intelligence Network Need of the Hour to Stem Black Money Inflow—K V M Pai

By Nina Rai, Pics: Dayanand Kukkajje
Daijiworld Media Network—Mangalore (CN)

Mangalore, Nov 21: A lecture on ‘Black Incomes in India—Tax Evasion and Solutions’, was given by K V M Pai, retired chief commissioner, income tax, Mumbai, on Wednesday November 19 at T V Raman Pai Convention Centre, Kodialbail. It was organized jointly by the Economic Research Centre (ERC), Mumbai/Mangalore, and Indian Liberal Group (ILG)—Kanara Chapter.

G Giridhar Prabhu, trustee of ERC and president of ILG–Kanara Chapter, warmly welcoming Pai, spoke highly of his 37 years of service in the income tax department of the Indian Revenue Service (IRS). Prabhu also welcomed Srinivas S Kamath, president, Kanara Chamber of Commerce and Industry (KCCI), Mangalore. Emphasizing the powerful impact of unaccounted income on the Indian economy, he said it is very important for us to think about the deterioration of values in our society caused by it.

In his speech, Pai talked about the evils of black money in the system. Quoting a newspaper, he said the amount of unaccounted Indian currency in Swiss accounts is a staggering Rs 1,45,6000 crore which equals the total revenue collection of India in the last decade. Other safe tax havens for Indians are the UK, USA, Germany, and France, with Dubai and Hong Kong, the new favorites. He questioned where our sense of patriotism was if so much money is siphoned off abroad and not made available to India for her development.

Quoting Prof B R Shenoy, founder, ERC, and famous economist, Pai said ‘Black money is here to stay unless we strike at the root of the problem’. ‘It was Prof Shenoy who highlighted the ill-effects of black money in India in the past and sought to deal with it as it damages not only the economy but also the social fabric of our nation. It was he who believed that if the rule of law prevails, the economy will represent the ‘honest rupee earned by every Indian’, he added.

According to Pai, the need of the hour is a good intelligence network in the IRS similar to the one practiced in the US as also computerization of all records. With regard to the Voluntary Disclosure Schemes introduced in the country, he said each of these schemes yielded negligible revenue, as taxpayers abused the schemes to convert black money into white by paying nominal amount of tax.

He said that real estate and the construction industry, was where most of the black money was invested. Bank deposits, shares and debentures, post office savings accounts, gold and diamond jewellery in bogus names, are the other favorites for investing black money. In conclusion, he urged all citizens to pay their taxes honestly.

Srinivas Kamath, said the problem of black money is a social evil prevalent all over the world, more so in developing countries where the tendency of citizens is to evade taxes. According to him government policies encourage such attitudes. He urged the centre to look into indirect taxes, VAT, MODVAT so that there is less scope for tax evasion.