What is black money
Black money is that which is taken under the table. It is not linked to any bank. Neither the giver nor the receiver is linked to the bank. It is a cash transaction only and its information is only between two parties.
Black money in India
India ranks fourth in the world in terms of black money. The total black money in India is about 500 billion US dollars. A large part of it is in Swiss banks and the rest is in other countries.
Types of black money
illicit money
Money which has come into the country illegally or crossed the borders, such as corruption, smuggling, tax evasion and terrorist activities, such cases are very serious. Or sending and receiving money abroad by deciding the wrong price of an item, etc.
legal income that is not reported to the tax authorities
This is the Black money which you have earned through white means but have not given the information to the government like Gold, Silver, Diamond, Land, Flat, Marriage, Bribe etc. Every thing which was taxable income but whose information was not given to the government is now black money, it generally happens within the country only.
How to earn black money
There are many ways of earning black money like crime, corruption, non-compliance of tax rules, money laundering, smuggling and terrorist activities and mispricing etc. but now it has been controlled to a great extent.
Total black money in world
$991.2 billion of crime, corruption and tax evasion was sent out of the country from all developing and developed countries. China is in first place, Russia is second, Mexico is third, India is fourth and Malaysia is fifth. India's Central Bureau of Investigation (CBI) director said that Indians have more than $500 billion of illegal money in foreign tax havens.
Black money act in india
Anti-money laundering law has been strengthened and more institutions have been brought under its ambit. India has also signed agreements with many other countries to obtain information about illegal money. The government has amended the Money Laundering Act 2002 to stop black money. Efforts are being made to stop black money in India through the appointment of Lokpal-Lokayukta, anti-corruption law, Benami Transaction Prevention Act and Real Estate Act.
Black Money Act 2015
- It provides for penalties for concealment of foreign income.
- If there is direct evidence of the existence of assets, the person concerned is required to pay tax at the rate of 30% and a penalty equal to three times the amount or 90% of the undisclosed income or the value of the asset.
- The Act provides for a jail term of 3-10 years for wilful tax evasion.
- It provides for a one-time compliance window for declaring assets acquired abroad and payment of tax and penalty determined on the value of assets so declared.