But a manufacturing company earning
profit of more than one crore per year can avoid tax payment completely by
using various tools of tax avoidance suggested by tax officials, tax
consultants and Chartered Accountants. In India one may find persons or firms
in every town who guide businessmen how to avoid tax payment, who suggest
various illegal ways for tax evasion and who works as broker for tax assessing
officials and setting bribe sharing rates among tax officials , businessmen and
broker himself for passing of IT assessment order from tax offices.
River of black money flaws from houses of these business icons only because they know many ways of tax avoidance
and it is they who are master in creation of black money. It is they who keep politicians happy by giving them alms in many ways and it is they who in turn provide safety net to business houses from the clutches of tax officials.
They altogether work in nexus with each other.
Similarly there are lacs of such
doctors, chartered accountants or property valuers, ,builders , chartered
engineer ,cine artists , tax consultants, stock brokers earning more than
Rs.10.00 lacs per year but not paying Income tax at all or paying hardly
a few thousands of rupees for name sake or for maintaining a Income tax
file and keeping himself in the list of tax payees.
A service man earning 3 to 5 lacs rupees
per year will have to pay income tax to the tune of 10 to 2o thousand rupees
.But in India there are crores of traders who are earning more than ten lac
rupees per year but not paying any tax or paying a few hundred rupees as income
tax. These small traders and service providers are completely outside the
purview of income tax or sales tax officials . They have to give a few
thousands of rupees as Baksis (which means bribe) to tax officials from time to
time.Tax avoidance is very common and imbibed in the blood of all businessmen.
As long as ministers in particular and
politicians in general who are in power are corrupt, illegal money earners and are tax evaders, it will be foolish to expect that these politicians will ever be interested in making of any hard and effective law for completely stopping tax
evasion or in ensuring punishment to tax evaders or taking action against black money creators.
As a matter of fact tax evasion and
creation of black money and then parking it in banks in fake name or investing
in landed property or parking the same at foreign banks is no new thing in
India. Really speaking, politicians cannot survive if businessmen start honest
payment of all taxes, complete tax compliance and stop all types of tax evasion.
- Action against tax evaders or black money creators or corruption promoters is taken only when interest of various individuals or groups clashes .
- Problems arise only when businessmen fail to pay committed bribe and commissions to brokers or tax officials or to politicians.
- Problems arise only when there is dishonesty in sharing of ill earned money among various persons of tax department.
- Problems arise when there is inter corporate or inter businessmen rivalry and when the one or the other businessmen complains against his rival businessmen.
- Problems arise only when the business houses give donation to one political party and avoid other political party.
- Problems arise only when ego issue clashes among tax officials, politicians and business houses.
As far as I understand, government of
India has framed several laws during last six decades and more to deal with
black money and to reduce the instances of tax evasion. It is also true that they understand very well that huge amount of black transactions use to take place in the system to avoid tax payment and which helps in growth of black money in the economy. This is why GOI has also come out with various schemes during last six decades for voluntary disclosure of black money
by businessmen and tax evaders in general .They know very well how tax evasion
have been taking place in entire country and in all sectors .
It is politicians who are the root cause of all such non compliances of tax rules framed by none other than politicians themselves.
It is politicians who are the root cause of all such non compliances of tax rules framed by none other than politicians themselves.
The concept and idea of GAAR also came
into the mind of politicians only to teach a lesson perhaps to Vodafone or
similar other business entities where the Supreme Court exposed the hollowness
of tax rules. But again the concept of GAAR got miscarriage and Government of
India was forced to abandon the concept in the initial stage itself under the
pressure of none other politicians who are agents of some corporate houses.
To avoid conflict among various
ministers and various politicians associated with various corporate houses,
government instituted another committee to nullify and postpone the
introduction of General Anti Avoidance Rules. Black money or foreign direct
investment comes through small countries only to convert their black money into
white and to avoid tax payment.
Unfortunately our country has become so
much weak in the hands of dirty politicians that they cannot imagine of
avoiding FDI and cannot imagine of making stringent Anti Tax
Avoidance Rules like GAAR and cannot ensure compliance of rules in
true spirit.This is why, every time they come out with an idea of nailing
tax evaders they succumb and bow down under pressure of their own corporate
houses and mafias which nourishes election fund too.
I therefore do not hesitate in saying
that it is politicians who are allowing foreigners or Indians Black Money masters
to route their fund through countries like Singapore or Malasia to invest in
stock market and avoid tax payment fully.
It is politicians who guide
corporate how to avoid tax payment and in return get huge fund for elections.
It is politicians who provide safety net
to tax evaders by building pressure on IT officials or ED officials or Custom
officials to close the files of such tax evaders and in return they are awarded
by huge amount of money and stock.
It is politicians who dilute the
provisions of many laws to make it suitable to business houses whom they like.
It is politicians who are allowing
Education Mafia and real estate builders to sell their degree at exorbitant
prices and sell their flats and commercial space at exorbitant higher prices
but accept money partly in black and partly in white.
It is politicians who are indirectly
supporting sell of all products without bill and transport the goods from
"Delhi or Mumbai to any corner of the country without paying sales tax or
income tax or central sales tax. This is because most of the politicians are
themselves big businessmen.
It is again politicians who build
pressure on bank management for sanction of loans to their kith and kin,
relatives, friends and political supporters and it is they who recommend for
waiver or loan or for compromise settlement with defaulters.
It is again the politicians who
willfully keep judiciary weak or select judges of their choice who can postpone
cases filed by tax departments or bankers to recover their dues are postponed
indefinitely
Who will then cure the system and who
will pass the proposed GAAR?
It
is possible only in India that politicians , Members of Parliament and Members
of State Assemblies or Heads of various Public Sector undertakings or High
ranked civil and police officials have
got no source or income or have very little source of income but have
accumulated wealth of hundreds of crores of rupees.
When law makers are law violators and
when law enforcing agencies are teaching tips of tax evasion one cannot dream
of success of any Anti Tax Avoidance rule, keep apart GAAR to get planned
success in real field of life.
Ramdeo Baba or Team Anna will go on
crying and crying against black money or against corruption, nothing is going
to happen positive in India as long as politicians mend their style of living,
style of functioning and their corrupt culture in the name of democracy or in
the name of secularism.
If there is a will there is a way, it is
an old proverb. But unfortunately in India there is no will among politicians
who rule the country to bring about real reformation in the country.
Politicians know the art of speaking and the art of preaching sermons and hence
they will continue to befool illiterate dominated Indian population with the
help of caste or communal card or the quota card.
To know more about GAAR click on folling link
To know more about GAAR click on folling link
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