Black money in Switzerland and other tax havens

[nandu]

Govt notice to Indians holding black money abroad

In a breakthrough in the government's efforts to track down black money held by Indians in foreign banks, Germany has given Indian authorities a list of some 50 individuals who have now been sent notices for tax evasion.

Highly placed sources in the Finance Ministry said that the government in Germany had sent a list some two months ago and notices were sent after scrutinising the same.

"Based on whatever information we received from the German authorities, we have issued notices to the tax evaders related to Indian context in February and March," a senior official of the Central Board of Direct Taxes (CBDT) said.

However, the exact number of persons contained in the list and the illegal money in the accounts of German banks could not be ascertained immediately.

The sources also indicated that information about these persons is being collected and other suitable action could follow.

http://www.ndtv.com/news/india/govt-notice-to-indians-holding-black-money-abroad-28261.php

 

[thakur_ritesh]

http://blackbehindwhite.blogspot.com/2010/04/indian-black-money-in-swiss-bank-myth.html

Indian Black Money in Swiss Bank: Myth and Reality

This article reminds me of two sayings in hindi

Khoda pahar, nikli chuhia!
rai ka pahar banana!

And seriously after a pretty long time have I read a sensible article on this issue. I seriously want to know from did this huge wealth creation happen in India, and if people from overseas have been sending this money back and then to the swiss banks then what was the charm of routing all this money this way?

As if that laughable figure of 1.4t usd was not enough, so here comes another pack of politicians claiming 2.6-5.2t usd as black money, heck that had been they case do these very intelligent politicians even realize India would have gone broke much-much earlier than a Greece and then the PIIGS happened to this world, and one wonders even if the amount is 1.4t usd, why has India not been declared as the most corrupt nation in the world?

Imagine advani quoting wiki, now tomorrow I edit the figure to 10t usd, he will jump to it. Why do these politicians have to take the whole country for a ride?

I will be surprised if parallel economy and black money stacked elsewhere is more than half of our actual economy, and even this figure doesnot make sense!

 

[171K]

India's TRILLION dollar Swiss Bank Accounts !!!

The question is, are the people of India going to stand by and do absolutely nothing about this, just turn a blind eye as usual! This money can transform India, it can easily pay off India's national & foreign debts, build infrastructure and drastically reduce or better still eliminate poverty.

I cannot believe Indians keep these corrupt, anti-national, useless, incompetent, impotent leaders & politicians in power. Yeh, yeh, yeh divide & rule politics, vote bank politics, etc, surely after centuries of being *******, Indians should have learnt their lessons by now!!!

Grrrrrrrrrrrrr.......:angry_1:

 

[LETHALFORCE]

India can now follow the black money | Analysis & Opinion |


India can now follow the black money

Indians love many things about Switzerland: chocolates, watches, Bollywood movie locales and secret bank accounts.

Until now.

India and Switzerland on Monday signed a pact amending the existing double taxation avoidance agreement, that will make it easier for New Delhi to gain access to information on suspect bank accounts, possibly paving the way to recovering billions of dollars in undeclared wealth.

It is anyone's guess just how much money is stashed away in secure vaults in the scenic Alps.

The main opposition Bharatiya Janata Party, which made repatriating "black money" one of its election promises last year, estimates there may be some 25,000 trillion rupees, or roughly half India's GDP of $1 trillion, in secret Swiss accounts.

Other estimates are even higher.

A report from Global Financial Integrity last year said $23-$27 billion in illicit money left India every year in the period 2002-06; some of it to offshore financial centres, and the rest to tax havens and traditional banks including big Swiss banks.

These are not just retirement funds. Besides depriving countries of valuable resources for development, experts warn "black money" is often used to fund militants, and therefore poses a major security risk, as well.

But signing a deal to gain access to this money is one thing, assembling convincing evidence of these accounts is another.

Swiss bank UBS last year agreed to hand over details of more than 4,000 American accounts to the U.S. government for investigation of tax evasion.

But Swiss banking officials, who have long resisted pressure to open up, have already indicated India cannot simply "throw a telephone book" at Switzerland and expect ready cooperation.

What India needs to do is build strong cases against people it suspects are guilty of tax fraud and graft.

It will not be easy, as they may well include politicians and other powerful figures. But with an abysmal ranking when it comes to corruption, India has much to gain from building credible evidence against tax evaders.

India has shown serious intent with the pact; now it needs to demonstrate serious and swift action.

 

[The Messiah]

Nothing will happen.

They will only blackmail to get there slice of the cake.

 

[Parthy]

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

NEW DELHI: In a season of swindles, kickbacks and scams, here is some more on the mother of them all. Black money — the popular moniker given to the billions seeded by dirty deals and whisked away abroad from the taxman's prying eyes — has received much attention in recent years.

The opposition never tires of screaming foul at the government. The government, for its part, is at pains to say it is doing all it can to track down the illegal stash.

Despite the cacophony, an estimate of the scads of black money in secret bank vaults overseas has long been one big unknown, resulting in a great deal of speculation and glib talk around the subject.

Finally, some help is at hand. A new study by an international watchdog on the illicit flight of money from the country, perhaps the first ever attempt at shedding light on a subject steeped in secrecy, concludes that India has been drained of $462 billion (Rs 20,556,848,000,000 or over Rs 20 lakh crore) between 1948 and 2008.

The amount is nearly 40% of India's gross domestic product, and nearly 12 times the size of the estimated loss to the government because of the 2G spectrum scam. The study has been authored by Dev Kar, a lead economist with the US-based Global Financial Integrity, a non-profit research body that has long crusaded against illegal capital flight.

Mr Kar, a former senior economist with the International Monetary Fund, says illicit financial flows out of India have grown at 11.5% a year, debunking a popular notion that economic reforms that began nearly two decades ago had tempered the creation and stashing away of black money overseas.

Outflows accelerated after reforms

If capital outflows were a child of the independence era, the problem came of age in the years after the reforms kicked in. Nearly 50% of the total illegal outflows occurred since 1991. Around a third of the money exited the country between 2000 and 2008.

"It shows that reforms seem to have accelerated the transfer of black money abroad," says Mr Kar, whose study titled 'The Drivers and Dynamics of Illicit Financial Flows from India: 1948-2008' sifts through piles of data on the issue over a period of 61 years. The study, which Mr Kar says is the most comprehensive one yet on illicit financial flows from India, will be made public on Thursday.

His report comes amid a renewed government push in recent months to pursue black money stashed abroad. In late August, the government signed an agreement with Switzerland — its banks top a list of usual suspects — that will enable exchange of information on tax evaders. New Delhi is also in talks with at least 20 tax havens, particularly Mauritius, to extract similar information.

The government is also attempting to gain a measure of the total unaccounted money circulating in the economy. The finance ministry last week approached the National Institute of Public Finance and Policy to get a fix on such money.

But M Govinda Rao, director of the institute, says his think-tank is yet to decide on going ahead with the exercise because it is not an easy task. "A study on this subject is a huge challenge because one is dealing with a very big problem that covers hordes of money from many sectors," he says.

Black money turned into an election issue during the 2009 general elections, with the BJP harping on the issue throughout its campaign. Its leader LK Advani has been the most vocal critic of the government on this issue, time and again questioning the government's resolve to chase illegal funds. Mr Advani recently urged the government to publish a white paper on the issue.

While Mr Advani was unavailable for comment, the government's detractors on this issue say there is more talk than action to address this issue.

"Everybody knows about the gravity of the problem, but the government has not shown the political will to bring the money back to India," says Prakash Karat, general secretary of the Communist Party of India (Marxist).

The government has, however, received praise from Paris-based Organisation for Economic Cooperation and Development, which has been at the forefront of the fight against tax evasion. OECD, whose relentless offensive is largely credited with lifting the veil of secrecy over umpteen tax havens, hailed India's efforts to crack down on tax evasion and sign information exchange agreements earlier this year.

These are but short-lived answers, say experts, adding that an overhaul in the global financial system is central to a lasting solution. New tax havens will spring forth when pressure mounts on existing ones.

That is not to say there are only a few tax havens out there. Indeed, at least 91 such hotspots flourish across the globe. Asian countries, particularly Thailand, Singapore, Hong Kong and Macau, too are emerging as new destinations for parking illicit funds.

Besides Switzerland and Mauritius, Indian money is also said to end up in Seychelles and Macau. Due to the illicit nature of these deposits, pinpointing the journey's end of the bulk of India's black money is tenuous at best.

The GFI study gives a measure of the amount of money that the government is chasing, but it is only a fraction of the $1.4 trillion that the BJP claims is the illegal stash.

GFI acknowledges as much, saying its figure is conservative and hasn't taken into account smuggling and certain types of trade mischief. It also admits to gaps in available statistics, lamenting the lack of data on the consolidated fiscal balance with the government, which has hampered research. If these indicators were counted, India's total illicit outflows would well be half a trillion dollars.

http://timesofindia.indiatimes.com/...48-2008/articleshow/6946266.cms#ixzz15cfksOZs

 

[Iamanidiot]

Switzerland is not the on;y place for secret banking

 

[badguy2000]

the post fully proves that what Indian politicans and babus are best at is not to earn money for the country,but for themselves.

 

[The Messiah]

the post fully proves that what Indian politicans and babus are best at is not to earn money for the country,but for themselves.

For once i agree with you. china is 5th in the list though.

 

[badguy2000]

For once i agree with you. china is 5th in the list though.

China''s GDP ranks 2nd and its black money ranks 5th....so, the rank is not tooo bad.

 

[Vinod2070]

^^ China is not immune from corruption. Not by any stretch.

Only the corruption is not splashed in the media there to the extent it is in democratic countries.

 

[badguy2000]

^^ China is not immune from corruption. Not by any stretch.

Only the corruption is not splashed in the media there to the extent it is in democratic countries.

come on ,guy!

90% of Chinese tourists to India were once blackmailed by Indian customs officers when they were in airports in Indians.

anyhow, Chinese tourist to India indeed are very impressed on such bare corruption in the global biggest democracy!

here are the most Chinese tourist's impression on India babus : Shameless,inefficient and corrupted.

Before they visited India, most of CHinese tourist felt once CCP officials quite corrupted and shameless. but after they visited Indians, they all feel that CCP officials as lovely as Angels,if compared with Indian babus.

 

[sukhish]

Can't agree with you more on this one. I have always admired china. What good a democracy, which can't deliver. Indian parliament has become a bickering platform for the two main parties. even though I'm silent on this forum, but I always feel that Chinese people are much more disciplined and educated than ours. I really like the Chinese workforce, extremely professional and very hard working as well. may be we Indians should stop doing chest thumping and should try to learn from the Chinese. the problem in India is very simple, lot's of uneducated people are easily targeted by the politicians to get votes. As a result when these kind of incompetent people get into higher offices, they select equally incompetent bureaucrats, which are running this country. One thing I admire the CCP most is the way they have infused disciple among Chinese. it is very remarkable. even in the US I can see all the Unionized/lazy workers are electing the same kind of politicians. it is coming down to very a simple logic, people with government jobs wants to keep the government big by arranging votes for the like minded politicians, California is biggest example of this in US. for me it doesn't matter whether it is democracy or CCP, as long as it delivers. see the problem in nepal , the so called democracy could not deliver and hence moist are taking over that country. good for them.

Last but not the least, Chinese woman are also very pretty. I think it's time for me to visit china with my wife and kids.

 

[Vinod2070]

come on ,guy!

90% of Chinese tourists to India were once blackmailed by Indian customs officers when they were in airports in Indians.

anyhow, Chinese tourist to India indeed are very impressed on such bare corruption in the global biggest democracy!

here are the most Chinese tourist's impression on India babus : Shameless,inefficient and corrupted.

Before they visited India, most of CHinese tourist felt once CCP officials quite corrupted and shameless. but after they visited Indians, they all feel that CCP officials as lovely as Angels,if compared with Indian babus.

I am not denying that corruption is a problem in India. However, I would appreciate you giving some source for this absurd claim of 90%.

I don't understand why a Chinese tourist would even need to come into contact with an Indian officer. Same as most Indian tourists won't need to talk to the corrupt provincial CCP babus in China.

I can only assume you are lying through your teeth.

 

[Parthy]

come on ,guy!

90% of Chinese tourists to India were once blackmailed by Indian customs officers when they were in airports in Indians.

anyhow, Chinese tourist to India indeed are very impressed on such bare corruption in the global biggest democracy!

here are the most Chinese tourist's impression on India babus : Shameless,inefficient and corrupted.

Before they visited India, most of CHinese tourist felt once CCP officials quite corrupted and shameless. but after they visited Indians, they all feel that CCP officials as lovely as Angels,if compared with Indian babus.

Again just a group of sentence to prove a pointless fact in a debate!!!

90% of Chinese tourists to India were once blackmailed by Indian customs officers when they were in airports in Indians. -> Do you have any source on this?? Without proof, these are just a sentence with no content...:emot159:

 

[LETHALFORCE]

http://www.dnaindia.com/opinion/column_the-india-growth-story-is-propelled-by-black-money_1483957

The India growth story is propelled by black money

Post-Nira Radia, many economists and experts have been wondering whether our reforms, which are supposed to be facilitating growth, are giving raise to crony capitalism.

These experts look at India with western lens and cannot think beyond received wisdom from Oxford and Harvard. They do not realise that the corporate sector has a relatively small share of GDP — not more than 15%. We are a nation of the self-employed.

The service sector, which constitutes more than 60% of GDP, is the engine of our economic growth. It is predominantly driven by partnership and proprietor-owned firms engaged in construction, trade, transport, hotels, and other services provided by the likes of plumbers and painters.

It is this self-employed sector that is propelling our 9% growth story even though corporate bodies and government ministers appropriate praise for the economy's performance.

It is estimated that at least 10% (some suggest 30%) of our national income could be black money. It implies that out of nearly Rs60,00,000 crore of estimated GDP in the current year, more than Rs6,00,000 crore could be black money.

A substantial portion is due to corruption by government employees. This money is not kept in cupboards or under the bed, though one '90s telecom minister (Sukh Ram) did stuff it inside pillows.

Money, white or black, circulates. The farther away it is from white, the faster it circulates.

A big chunk of the working capital requirements of the unorganised sector is met through non-institutional funds like chits and money lenders.

The retail trade has been growing at the compounded annual growth rate (CAGR) of 9.4% between 2004-05 and 2008-09 when the economy registered 8.6%. Trade includes everyone from street vendors to departmental stores.

It has a 15%share of GDP, which implies that it adds value of Rs9,00,000 crore.

In the case of retail trade, almost all capital is working capital. Assuming at least 60% of the value addition represents working capital needs, we get a figure of more than Rs5,00,000 crore as credit needs.

Of this, not more than 30% is provided by institutional credit, with moneylenders providing the rest. The same is the case with hotels and restaurants, transport and construction and other services, which — along with retail trade — constitute more than 50% of the economy. Almost all these are partnership/proprietorship firms.

They are classified as households in savings as well as lending data.

The share of the household sector in bank credit has come down to 47% from 58% between 1990 and 2004 while the sector's share in trade, transport, construction, restaurants, and other services has been growing at more that 8% CAGR.

Here, households include agricultural households and, to that extent, the fall is very significant. Put another way, the growth rate of the last decade is not related to the credit mechanisms of the banking sector.

This is banking with significant structural distortions.

The share of the private corporate sector in national income is around 12-15% but it takes away nearly 40% of the credit provided by the banking sector.

The fastest growing non-corporate sector gets a lesser share, which suggests that the non-institutional financial sector is playing an important role in credit delivery.

We find that 43% of rural household and 25% of urban household debt relates to moneylenders . So, where does the unorganised sector get the funds?

According to our absurd laws, moneylenders cannot borrow, but can only lend. The huge amount of black money generated by nearly 30% of government employees (the previous CVC, Pratyush Sinha, suggested a 30% corruption rate) is probably used in the unorganised credit market.

Given the regulations pertaining to KYC (know your customer) norms, it is difficult to save with banks or mutual funds. So the entire black money is finding avenues in the unorganised market where interest rates are very attractive.

The crime news in many towns is about violence between small-time moneylenders and enforcers. One can infer that policemen are entering the market both as lenders and collection agents.

This has implications for our governance system since the duty of the cop is definitely not to support unorganised banking.

How do we deal with it? Since we are a relationship-based society, it is not possible to surgically remove the cancer of corruption.

If we do that, our growth will suffer in the short term. The best way is to integrate the unorganised sector with the general financial architecture and enlarge the availability of credit and funding to all instead of restricting it to corporate 'thieftains'.

We have to think beyond the 15% of our corporate economy to understand economic growth. Balancing the need for probity with growth of the economy is the big challenge of the coming decade.

In other words, crooks do help in economic growth but society has to decide what price we are paying for this and strive to balance growth with probity and order.

 

[utubekhiladi]

Is India poor, who says? Ask Swiss banks

With personal account deposit bank of $1500 billion in foreign reserve which have been misappropriated, an amount 13 times larger than the country's foreign debt, one needs to rethink if India is a poor country?
DISHONEST INDUSTRIALISTS, scandalous politicians and corrupt IAS, IRS, IPS officers have deposited in foreign banks in their illegal personal accounts a sum of about $ 1500 billion, which have been misappropriated by them. This amount is about 13 times larger than the country's foreign debt. With this amount 45 crore poor people can get Rs. 1,00,000 each. This huge amount has been appropriated from the people of India by exploiting and betraying them.

Once this huge amount of black money and property comes back to India, the entire foreign debt can be repaid in 24 hours. After paying the entire foreign debt, we will have surplus amount, almost 12 times larger than the foreign debt. If this surplus amount is invested in earning interest, the amount of interest will be more than the annual budget of the Central government. So even if all the taxes are abolished, then also the Central government will be able to maintain the country very comfortably.

Some 80,000 people travel to Switzerland every year, of which 25,000 travel very frequently. "Obviously, these people won't be tourists. They must be travelling there for some other reason," believes an official involved in tracking illegal money. And, clearly, he isn't referring to the commerce ministry bureaucrats who've been flitting in and out of Geneva ever since the World Trade Organization (WTO) negotiations went into a tailspin.

Just read the following details and note how these dishonest industrialists, scandalous politicians, corrupt officers, cricketers, film actors, illegal sex trade and protected wildlife operators, to name just a few, sucked this country's wealth and prosperity. This may be the picture of deposits in Swiss banks only. What about other international banks?

Black money in Swiss banks — Swiss Banking Association report, 2006 details bank deposits in the territory of Switzerland by nationals of following countries:

Top five

India—- $1456 billion
Russia—$ 470 billion
UK——-$390 billion
Ukraine- $100 billion
China—–$ 96 billion

Now do the mathematics – India with $1456 billion or $1.4 trillion has more money in Swiss banks than rest of the world combined. Public loot since 1947: Can we bring back our money? It is one of the biggest loots witnessed by mankind — the loot of the Aam Aadmi (common man) since 1947, by his brethren occupying public office. It has been orchestrated by politicians, bureaucrats and some businessmen. The list is almost all-encompassing. No wonder, everyone in India loots with impunity and without any fear.

What is even more depressing in that this ill-gotten wealth of ours has been stashed away abroad into secret bank accounts located in some of the world's best known tax havens. And to that extent the Indian economy has been stripped of its wealth. Ordinary Indians may not be exactly aware of how such secret accounts operate and what are the rules and regulations that go on to govern such tax havens. However, one may well be aware of 'Swiss bank accounts,' the shorthand for murky dealings, secrecy and of course pilferage from developing countries into rich developed ones.

In fact, some finance experts and economists believe tax havens to be a conspiracy of the western world against the poor countries. By allowing the proliferation of tax havens in the twentieth century, the western world explicitly encourages the movement of scarce capital from the developing countries to the rich.

In March 2005, the Tax Justice Network (TJN) published a research finding demonstrating that $11.5 trillion of personal wealth was held offshore by rich individuals across the globe. The findings estimated that a large proportion of this wealth was managed from some 70 tax havens.

 

[Iamanidiot]

first of all if our government is more business friendly the economy might not have become like this.This is what happens in a socialist economy

 

[SHASH2K2]

Declare names of Swiss bank account holders: BJP

Declare names of Swiss bank account holders: BJP
​

BHUBANESWAR: The BJP today asked the Centre to immediately declare names of the Indians who had stashed black money in Swiss banks.

"UPA government should, without any hesitation, make public names of all those who have stashed black money in Swiss bank accounts," BJP president, Nitin Gadkari told reporters here.

Claiming that about Rs 21 lakh thousand crore had been deposited in Swiss banks, Gadkari said instead of trying to suppress fact, the government should publicise the names particularly after WikiLeaks' report on the matter.

"Any reluctance in declaring the names of Swiss bank account holders will simply raise doubts about the integrity of people at the helm," he said.

Asked if names of BJP leaders may appear in the list, Gadkari said action must be taken without any consideration.

Claiming to have Swiss bank account numbers of three persons in the Bofors pay-off case, the BJP chief said a lot of information including alleged transfer of money to Italian businessman Ottavio Quattrocchi's account came to light after the Income Tax Appellate Tribunal order.

Accusing Prime Minister Manmohan Singh of failing miserably on the economic front due to wrong policies, Gadkari said UPA government had failed to control skyrocketing prices of essential commodities, while repeated hikes in petro products placed unbearable burden on the poor and hit progress.

Similarly, 2G spectrum scam, CWG loot, Adarsh society scandal any many other frauds had exposed the alleged nexus between the political brass of the ruling alliance and their co-conspirators, he said.

The BJP president also described as "unfortunate" the affidavit submitted by the Centre in the Supreme Court defending the appointment of controversial CVC P J Thomas facing a corruption case in a Kerala court.

Stating that the Leader of the Opposition, Sushma Swaraj had opposed Thomas' appointment, he wondered, if the Centre felt there was no need for consensus of the three-member committee on CVC's appointment, for what purpose was the panel formed.

Since the appointment of CVC was a sensitive matter, Swaraj's dissent should have been taken into account to ensure fair, independent and impartial functioning, Gadkari said, accusing Congress of not following democratic norms.

Stating that BJP was sticking to its demand for a JPC probe into the 2G spectrum scam, he said steps should be taken to seize and auction assets amassed through corrupt means.

Read more: Declare names of Swiss bank account holders: BJP - The Times of India http://timesofindia.indiatimes.com/...ers-BJP/articleshow/7311565.cms#ixzz1BUILMFm7

 

[sesha_maruthi27]

If congress declares the names which are in the list, then the first name would be from the Gandhi family itself and it will lead to chaos.