Now it is budget season. All the pundits are out with their suggestions and prognoses on how to take the country forward to commanding economic heights. I have a dream which NaMo will certainly share. That is to see Bharatam reaching a fair share of world GDP which the nation had in 1CE. (See Angus Madison bar chart). See: http://bharatkalyan97.blogspot.in/2015/02/pmo-sought-inputs-from-12-economists.html It is good to note that suggestions from over a dozen economists have been sought for the 2015 Budget. The Nation will come to a standstill as the Finance Minister reads and lays the Budget document on the floor of Lok Sabha.
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In summary, the suggestion from an economist of this blogpost is 1) to nationalise kaalaadhan by a declaration in the 2015 Budget which will become a Tax Law of the country; and 2) to strengthen the Bharatiya family by enacting appropriate fiscal (personal taxation) measures.
I have made a suggestion that family system of Bharatam Janam should be strengthened by offering discounts from personal taxation of the kartaa for expenses incurred by joint family members for the education and medical expenses of family members.
Here's my paise worth on kaalaadhan, the other major issue on which 2014 elections were fought, almost resulting in a Congress-mukt Bharat but surely achieving true SWARAJYAM BHARAT in May 2014, thanks to NaMo's inspiring leadership and representing the Will of the People in a resounding mandate.
1. NaMo, make kaalaadhan the key action point of the Budget. This means that specific steps should be incorporated into financial law of the country using the Budget soon to be legislated by the Parliament. Budget can be an instrument for expressing the Peoples' Will and broadcast to all tax havens who hold the illicit wealth stolen from poor Bharatiyas. Swiss Federation has an Act for Restitution of Illicit Wealth. I am sure Finance Ministry and Enforcement Directorate are aware of this law. There are similar legislations in other tax havens. The key is to send a message to tax havens that wealth of Indian citizens should be held WITHIN THE COUNTRY'S FINANCIAL SYSTEM.
2. Don't be taken in by the suggestions from financial experts that Double Taxation Avoidance Treaties are the means for recovering kaalaadhan. These Treaties are only mechanisms for delaying the processes with financial verbiage and endless letter exchanges with and visits to tax havens by enforcement officials. There is an international convention to which India is a signatory; so are may states including many tax havens. That is called United Nations Convention Against Corruption.
3. NaMo, you have taken a brilliant step in the first week of your office to appoint a Special Investigation Team on Black Money (Kaalaadhan Team) headed by Justices MB Shah and Arijit Pasayat, who function under the supervision of the Hon'ble Supreme Court. Follow the advice of these two eminent jurists. Also, look at the draft law suggested in an earlier Rajya Sabha Session through a Private Members' Bill by another eminent jurist, Fali Nariman. The suggestions made by the SIT Justices is simple. Declare kaalaadhan a criminal offence. This DOES NOT require any new law. A declaration by the Parliament through the approval of the 2015 Budget suffices. Once kaalaadhan is declared a criminal offence, there is a whole littany of laws in the statute books to bring the culprits to book, enforcing the law of the land. NO NEW LAWS ARE NEEDED. Just enforcement of laws related to Money Laundering, Foreign Exchange Management, Prevention of Corruption Act etc. etc. There are enough lawyers in NaMo's team to prosecute the cases against the illicit wealth holders of foreign bank accounts and accounts in tax havens without holding such monies within the nation's financial system. This is the fundamental problem. So, to resolve this, include a provision in the Tax law of 2015 Budget that all such monies should be transferred to the nation's financial system on or before, say, 30 June 2015, treating the assets as NATIONAL WEALTH. Declare in the Tax law of 2015 Budget that all foreign jurisdictions are required to transfer the assets to Resrve Bank of India which will operate a new fund under the Consolidated Fund of the State, call it Bharatiya Kaalaadhan Restitution Account.
4. Opening of a Bharatiya Kaalaadhan Restitution Account with RBI will mean that the beneficiaries of the assets should prove the bona fides of the assets. The onus of proof is on the account beneficiary. If the legitimacy of the assets is not proved to the satisfaction of the RBI under the Know Your Client principles of financial propriety for any banking transaction, the monies should be forfeited and credited to the Consolidated Fund of India, say under the Prime Minister's National Relief Fund. This will be a true and sincere step fulfilling the promise made to the Bharatiya electorate with all the claptrap associated with the political turmoil of 2014 and anti-corruption melas.
5. Under the UN Convention Against Corruption, unqualified right and obligation of states has been postulated to share information about concealed illicit wealth. This is inviolate. It is immoral, unethical, and of course for any State to withhold another nation's wealth, the wealth of another nation's citizen(s). The UN Convention has the force of International Law.
6. Declare through the Budget 2015 that kaalaadhan is evil, adharma, beyond being the most heinous criminal offence. There is no reason for any Bharatiya Nagarik to hold monies in foreign institutions in foreign countries when adequate financial institutions operate within the nation. This is part of the Make in India mission. Let the Bharatiya Nagarik make their artha, wealth WITHIN INDIA, that is Bharat. There is no need for seeking foreign financial expertise in managing the nation's wealth. Let not the tax havens be allowed to teach grand mothers how to suck eggs. This is translated into Hindi as: सीखे हुए को सिखाना Teaching the already taught. This simply means that the country has enough traditions of Artha S'aastra to manage wealth and to create wealth as trustees for the benefit of the poor Bharatiyas. We do NOT need foreign financial experts to manage our hard-earned monies.
7. So, NaMo, start with Advocate Nariman's draft and use the legal luminaries of the Govt. of India to enact SPECIFIC provisions in the 2015 Budget which will become the Tax Law of the nation, declaring that kaalaadhan is nationalised. This will be more resounding than Indira Gandhi's move to nationalise private banks -- a move which demonstrated the then PM's commitment to reach out to the poor Bharatiyas with a positive move ensuring the inclusion of all Bharatiyas in the wealth-creation activities in the nation.
8. This one move on kaalaadhan will enshrine -- in the law of the land -- NaMo as the true financial revolutionary of Swarajyam Bharatam achieved in May 2014.
Kalyanaraman
Sarasvati Research Centre
February 3, 2015
In summary, the suggestion from an economist of this blogpost is 1) to nationalise kaalaadhan by a declaration in the 2015 Budget which will become a Tax Law of the country; and 2) to strengthen the Bharatiya family by enacting appropriate fiscal (personal taxation) measures.
I have made a suggestion that family system of Bharatam Janam should be strengthened by offering discounts from personal taxation of the kartaa for expenses incurred by joint family members for the education and medical expenses of family members.
Here's my paise worth on kaalaadhan, the other major issue on which 2014 elections were fought, almost resulting in a Congress-mukt Bharat but surely achieving true SWARAJYAM BHARAT in May 2014, thanks to NaMo's inspiring leadership and representing the Will of the People in a resounding mandate.
1. NaMo, make kaalaadhan the key action point of the Budget. This means that specific steps should be incorporated into financial law of the country using the Budget soon to be legislated by the Parliament. Budget can be an instrument for expressing the Peoples' Will and broadcast to all tax havens who hold the illicit wealth stolen from poor Bharatiyas. Swiss Federation has an Act for Restitution of Illicit Wealth. I am sure Finance Ministry and Enforcement Directorate are aware of this law. There are similar legislations in other tax havens. The key is to send a message to tax havens that wealth of Indian citizens should be held WITHIN THE COUNTRY'S FINANCIAL SYSTEM.
2. Don't be taken in by the suggestions from financial experts that Double Taxation Avoidance Treaties are the means for recovering kaalaadhan. These Treaties are only mechanisms for delaying the processes with financial verbiage and endless letter exchanges with and visits to tax havens by enforcement officials. There is an international convention to which India is a signatory; so are may states including many tax havens. That is called United Nations Convention Against Corruption.
3. NaMo, you have taken a brilliant step in the first week of your office to appoint a Special Investigation Team on Black Money (Kaalaadhan Team) headed by Justices MB Shah and Arijit Pasayat, who function under the supervision of the Hon'ble Supreme Court. Follow the advice of these two eminent jurists. Also, look at the draft law suggested in an earlier Rajya Sabha Session through a Private Members' Bill by another eminent jurist, Fali Nariman. The suggestions made by the SIT Justices is simple. Declare kaalaadhan a criminal offence. This DOES NOT require any new law. A declaration by the Parliament through the approval of the 2015 Budget suffices. Once kaalaadhan is declared a criminal offence, there is a whole littany of laws in the statute books to bring the culprits to book, enforcing the law of the land. NO NEW LAWS ARE NEEDED. Just enforcement of laws related to Money Laundering, Foreign Exchange Management, Prevention of Corruption Act etc. etc. There are enough lawyers in NaMo's team to prosecute the cases against the illicit wealth holders of foreign bank accounts and accounts in tax havens without holding such monies within the nation's financial system. This is the fundamental problem. So, to resolve this, include a provision in the Tax law of 2015 Budget that all such monies should be transferred to the nation's financial system on or before, say, 30 June 2015, treating the assets as NATIONAL WEALTH. Declare in the Tax law of 2015 Budget that all foreign jurisdictions are required to transfer the assets to Resrve Bank of India which will operate a new fund under the Consolidated Fund of the State, call it Bharatiya Kaalaadhan Restitution Account.
4. Opening of a Bharatiya Kaalaadhan Restitution Account with RBI will mean that the beneficiaries of the assets should prove the bona fides of the assets. The onus of proof is on the account beneficiary. If the legitimacy of the assets is not proved to the satisfaction of the RBI under the Know Your Client principles of financial propriety for any banking transaction, the monies should be forfeited and credited to the Consolidated Fund of India, say under the Prime Minister's National Relief Fund. This will be a true and sincere step fulfilling the promise made to the Bharatiya electorate with all the claptrap associated with the political turmoil of 2014 and anti-corruption melas.
5. Under the UN Convention Against Corruption, unqualified right and obligation of states has been postulated to share information about concealed illicit wealth. This is inviolate. It is immoral, unethical, and of course for any State to withhold another nation's wealth, the wealth of another nation's citizen(s). The UN Convention has the force of International Law.
6. Declare through the Budget 2015 that kaalaadhan is evil, adharma, beyond being the most heinous criminal offence. There is no reason for any Bharatiya Nagarik to hold monies in foreign institutions in foreign countries when adequate financial institutions operate within the nation. This is part of the Make in India mission. Let the Bharatiya Nagarik make their artha, wealth WITHIN INDIA, that is Bharat. There is no need for seeking foreign financial expertise in managing the nation's wealth. Let not the tax havens be allowed to teach grand mothers how to suck eggs. This is translated into Hindi as: सीखे हुए को सिखाना Teaching the already taught. This simply means that the country has enough traditions of Artha S'aastra to manage wealth and to create wealth as trustees for the benefit of the poor Bharatiyas. We do NOT need foreign financial experts to manage our hard-earned monies.
7. So, NaMo, start with Advocate Nariman's draft and use the legal luminaries of the Govt. of India to enact SPECIFIC provisions in the 2015 Budget which will become the Tax Law of the nation, declaring that kaalaadhan is nationalised. This will be more resounding than Indira Gandhi's move to nationalise private banks -- a move which demonstrated the then PM's commitment to reach out to the poor Bharatiyas with a positive move ensuring the inclusion of all Bharatiyas in the wealth-creation activities in the nation.
8. This one move on kaalaadhan will enshrine -- in the law of the land -- NaMo as the true financial revolutionary of Swarajyam Bharatam achieved in May 2014.
Kalyanaraman
Sarasvati Research Centre
February 3, 2015