Black Money is a form of unaccountable Money. Black
Money is mostly created by business people. They do not show actual income
earned in their economic activites. They show only a part of income earned for
the purpose of Tax evasion.
The black money is accumulated by the criminals,
smugglers, hoarders, tax-evaders and other anti-social elements of the society.
In India, black money is funds earned in the black market, on which income and
other taxes have not been paid.The total amount of black money deposited in
foreign banks by Indians is unknown. The root cause for the increasing rate of
black money in the country is the lack of strict punishments for the offenders.
Effects of Black Money on
1. Dual economy (Dual economy in terms of
developed sector on one side under developed sector on the other side.)
2. Tax evasion, thereby loss of revenue to
3. Undermining equity
4. Widening gap between the rich and poor
5. Lavish consumption spending
6. Distortion of production pattern
7. Distribution of scarce resource
8. Effects on production.
InIndia, On 8-November-2016, the
Government of India announced demonetization of all ₹500 and ₹1000 bank notes
against Black Money.
Recent steps against Black Money
1. Under pressure from India and other
countries, Switzerland has made key changes in its local laws governing assist foreign
allegedly stashed in Swiss Banks.
2. Special Investigation Team appointed by
government on the directions of Supreme Court on black money.
Some Legislative Framework in
India against to Black Money
1 Prevention of money laundering act 2002
2 Lokpal and Lokayukta act
3. Prevention of corruption act- 1988
4. The undisclosed foreign Income and Asset
Bill(Imposition of Tax) 2015
5. Benami transactions prohibition act 1988 amended
6. The Real Estate (Regulation and Development)