Under attack for its inaction over black money allegedly stashed away in secret bank accounts in overseas tax havens, the government has announced a slew of measures over the last fortnight to bring slush funds into the legitimate financial system.
While Baba Ramdev was fanning nation-wide outrage in his war against corruption in austere outfits and earthy idioms, the government commissioned a joint study by three think-tanks—National Institute of Public Finance and Policy (NIPFP), National Institute of Financial Management (NIFM) and the National Council for Applied Economic Research (NCAER)—to estimate Indian entities’ unaccounted wealth both home and away.
The announcement in this regard came a day after the government declared that it has set up a up a committee headed by the Central Board of Direct Taxes (CBDT) chairman to examine ways to strengthen laws to curb the generation of black money. The steps include appropriate legislation, setting up institutions to deal with illicit funds, developing systems for implementation and training the manpower for effective action.
Finance minister Pranab Mukherjee has called for creating a multi-lateral cooperation mechanism so that banking secrecy laws do not come in the way of its crackdown on black money.
Transfer pricing poses problems with increase in cross border trade including within multinational enterprises located in developed, developing and undeveloped countries.
Companies use transfer pricing to minimise their worldwide taxes, duties and tariffs. The government is now upgrading transfer pricing norms to match global standards.