Estimation of Black Money

Estimation of Unaccounted Income/Wealth both Inside and Outside the Country.

 

In the recent past, the issue of black money has attracted a lot of public and media attention. However, by definition there can be no reliable estimates of black money generated and held within and outside the country. Amounts ranging between USD 500 billion to USD 1,400 billion have been estimated by different agencies to be unaccounted. A recent study by Global Financial Integrity has estimated the illicit money outflow to be USD 462 billion. Since these estimates are based on various unverifiable assumptions and approximations, the Government of India has commissioned an in-depth and fresh study to estimate unaccounted income and wealth held within and outside India. This study will also bring out the nature of activities that encourage money laundering and its ramifications on national security.

Institutes involved:

The following national institutes have been commissioned to take up the study.

1. National Institute of Public Finance and Policy (NIPFP), New Delhi
2. National Institute of Financial Management (NIFM), Faridabad
3. National Council of Applied Economic Research (NCAER), New Delhi

The terms of reference of the study are as follows:-

1. To assess/survey unaccounted income and wealth both inside and outside the country.
2. To profile the nature of activities engendering money laundering both inside and outside the country with its ramifications on national security.
3. To identify important sectors of economy in which unaccounted money is generated and examine causes and conditions that result in generation of unaccounted money.
4. To examine the methods employed in generation of unaccounted money and conversion of the same into accounted money.
5. To suggest ways and means for detection and prevention of unaccounted money and bringing the same into the mainstream of economy.
6. To suggest methods to be employed for bringing to tax unaccounted money kept outside India.
7. To estimate the quantum of non-payment of tax due to evasion by registered corporate bodies.

The study has already commenced in March, 2011 and is expected to be completed within a period of 18 months.
Reference:

Press Release of GoI