Budget sows seed for eradication!!! Believe it but it is a process and no way in the near offing, yes but true after 18 months of hibernation, the nation wakes up…
Well the cat is out of the bag and thanks to WiKiLeaks, who gave the needed break through. We are not responsible for the truthfulness of this report. Because we got the news that WikiLeaks posted in the website, but confirmed that there are more Indian accounts in Swiss Bank. In spite of hibernation of 18 months, sitting on the disclosures, the nation seems to be slowly waking up to the reality. Admiring to be a country like the United States, we fail to assimilate the good. No sooner WiKiLeaks disclosure on the US hoarders came up, the country intensified the combing down operation using all its bag of tricks to re-route the money back to its coffers. A big nation like ours is still contemplating a procedure to get it out. After much chaos, predominantly after the nation awoke to the call of the anti corruption crusader Anna Hazare. The government has introduced a meek proposal in the Budget 2012. However the meek proposal will get strengthened soon and let us hope and pray that it axes the roots of black moneytree.
Unfortunately those of the black money hoarders were awake, washed their hands in these 18 months and are now sailing in safe boats. The Swiss banks known for their NDA (Non Disclosure Agreement) nature, had signed an agreement for revealing facts of what has happened only after January this year. That simply means birds have flown to celebrate Christmas elsewhere. Had we the concern for our money or even a tenth of what WiKiLeaks had, then I think we would not have had this crisis.
As per the new rule in order to avoid tax, any company receiving the money has to explain the source of funds of its investors - a regulation that nullifies the old court ruling. Which only means that these hoarders till day engineered their funds by wire transferring their Swiss accounts to a foreign dummy company and then later the funds found their entry in to the national arena. Probably most would have already benefited in this 18 months of delay in action, but those of them planning now will be in problem..
Another important aspect that needs to be admired in the budget is even if the company reports loss; the unexplained expenses should be taxed. This would curtail the hoarders from utilizing the funds on high expenses. Even if a person shows an income level that's within the exempted category, the unusually high expenses can be taxed at a higher level. In other words, all with income below 10 lakh and not paying tax at the rate of 30% will have to pay tax at 30% on the undisclosed income (or unaccounted expenses). As every law has its repercussions, this law would also affect the middle class for whom an income of 7-10 lakhs, becomes natural. And along with income the expenses also increase. (With inputs from internet- AarKay)