Interim Budget 2014: Chidambaram plays it safe on black money issue

The issue ofblack money may have got social crusader Anna Hazare go on a fast and Arvind Kejriwal forming his own political party, but Finance Minister P Chidambaram decided to play safe on the issue of black money in his budget speech.

In entire xxx-page speech, the finance minister has dedicated eight lines to the issue.

AP

“Prosecutions for wilful tax evasion have been launched in 17 other cases. More enquiries have been initiated into accounts reportedly held by Indian entities in no tax or low tax jurisdictions,” he said.

He, however, did not elaborate on these cases either in his speech or at a post-budget press conference later.

Chidambaram said that the government has succeeded through alternative methods and special efforts in obtaining information in 67 cases ‘despite several hurdles in obtaining from the countries concerned’.

He said action is underway to determine the tax liability as well as imposition of penalty in these 67 cases.

“There has been much debate on illegal offshore-accounts held by Indians. Investigations into such accounts were launched in 2011,” Chidambaram said.

The issue of alleged tax evasion by Indians through banks and other entities in offshore locations, specially Switzerland, has been matter of a political debate in India.It has been alleged that Swiss banks have been used in a big way for years to stash black money by Indians and the matter is also expected to be a key issue in upcoming elections in India.

India has upped the ante against Switzerland to share banking information on tax evaders as part of its crackdown against black money in offshore accounts.

“All that we are trying to say is this exercise had started in 2011 and gathered pace in 2013. We faced numerous obstacles. Even now we have virtually no co-operation from a country like Switzerland…We are trying to get information through special efforts and alternative measures,” Chidambaram told reporters at a press conference post the budget.

The opposition was obviously not much impressed with Chidambaram’s speech on black money. Calling the interim budget ’extremely disappointing’, the BJP’s prime ministerial candidate Narendra Modi said, “The only solace one gets from the vote-on-account is that this was the UPA’s final act of misery after a decade of decay & policy paralysis.”

Modi said that Chidambaram did mere ’lip-service’on the issue of black money. “Mere lip-service by the FM on the return of black money; UPA’s lack of commitment towards bringing black money was on display yet again!”