How Are Black Money Created In India?
This article will give you an idea about how Black Money i.e. Unaccounted Income is generated in India. The example that I am giving here is my personal experience. Before going for the subject, first let me give you a meaning of Black Money or Unaccounted Income here.
The income generated by a person within a period of time is taxable if it comes under the specified tax slab. But if the person's income is taxable and doesn't pay his or her tax on the generated income to the central or state government then that income is called Unaccounted Income or what may be called The Black Money. This is the Income on which tax is not collected although the income is taxable. Evasion of Tax is punishable under different Acts of Parliament. To be the rational citizen of the country we must pay all our advance tax timely and help our government in National Building.
Now following paragraphs make you understand how unscrupulous business and common people create Black Money knowingly or unknowingly. And this was my personal experience when I was constructing my house that How the business people generate unaccounted income.
As per the Consumer Protection Act Consumers are given right to have original bill for amounts more than or equal to Rs. 50. But consumers are not aware of this right and of which the unscrupulous traders take this advantage and generate unaccounted income. The following paragraph make you understand the extent of Black money that is created in a small town by these unscrupulous traders.
Usually traders keep two types of vouchers or bill with them. One is the duplicate one where there is no name of the business and has no address. And the other one is original voucher or cash memo where there is proper name and address of the business. And this is the original voucher based upon which tax is collected by the government. When you approach to a trader for having some construction materials then until and unless you don't ask him for original bill he or she will not going to give you the original bill. Therefore, it is upon their discretion whether to give original bill or not and hence it is upon their discretion whether to show income or not to the government.
When I was constructing my house I had went to a trader for material and I asked him for original bill but he gave me the original bill after two months and so. And I was surprised to see the original bill and this made me clear that how they were generating Black money. Here I give you the extent of black money that he generated.
When I purchased some bags of cement he charged me Rs. 360 per bags. and later when I received the original bill it was written Rs. 330. Now see the difference of Rs. 30 is what? This is the money for which he will not going to pay tax. And hence in each bag of cement he generates Rs. 30 Black Money. And it is quite obvious that his one day turnover may be more than 100 bags and for one month the turnover might be more than 3,000 bags and for years it might be 36,000 bags of cement. See the Black money that he generates, Rs. 10,80,000 per year. And you know in a small town there is more than 30 such traders and hence in a town like such the traders generate more than Rs. 324 lakhs Black Money per year.
Obviously all traders are not like that, but until and unless we don't use technology in such transactions we cannot stop in generating such unaccounted income. Therefore there is urgent need for the use of modern technology. If we make all such transactions online then we can completely stop such generation of income.
Now following paragraphs make you understand how unscrupulous business and common people create Black Money knowingly or unknowingly. And this was my personal experience when I was constructing my house that How the business people generate unaccounted income.
As per the Consumer Protection Act Consumers are given right to have original bill for amounts more than or equal to Rs. 50. But consumers are not aware of this right and of which the unscrupulous traders take this advantage and generate unaccounted income. The following paragraph make you understand the extent of Black money that is created in a small town by these unscrupulous traders.
Usually traders keep two types of vouchers or bill with them. One is the duplicate one where there is no name of the business and has no address. And the other one is original voucher or cash memo where there is proper name and address of the business. And this is the original voucher based upon which tax is collected by the government. When you approach to a trader for having some construction materials then until and unless you don't ask him for original bill he or she will not going to give you the original bill. Therefore, it is upon their discretion whether to give original bill or not and hence it is upon their discretion whether to show income or not to the government.
When I was constructing my house I had went to a trader for material and I asked him for original bill but he gave me the original bill after two months and so. And I was surprised to see the original bill and this made me clear that how they were generating Black money. Here I give you the extent of black money that he generated.
When I purchased some bags of cement he charged me Rs. 360 per bags. and later when I received the original bill it was written Rs. 330. Now see the difference of Rs. 30 is what? This is the money for which he will not going to pay tax. And hence in each bag of cement he generates Rs. 30 Black Money. And it is quite obvious that his one day turnover may be more than 100 bags and for one month the turnover might be more than 3,000 bags and for years it might be 36,000 bags of cement. See the Black money that he generates, Rs. 10,80,000 per year. And you know in a small town there is more than 30 such traders and hence in a town like such the traders generate more than Rs. 324 lakhs Black Money per year.
Obviously all traders are not like that, but until and unless we don't use technology in such transactions we cannot stop in generating such unaccounted income. Therefore there is urgent need for the use of modern technology. If we make all such transactions online then we can completely stop such generation of income.
