Money is the source of transaction in the present civilized societies. Today it is present in two forms apparent and hidden. First form it is legal and which is open for taxation. In the second form it is illegal and is not exhibited for taxation.
The money which is earned by dishonest and immoral means and kept in secret to avoid taxes is called black-money. It converts into black because no taxes are paid on it. Money turned to be black if taxes due thereon are evaded. The massive amount of black money in our country has created a parallel economy. It has been beyond the bounds control for the Government. The black money has already formed as a serious problem in our country.
Black money is used by the rich in different malicious activities. They make use of this money for demoralizing and corrupting social life. They display it in extravagant living and reckless luxuries. They bribe Government officers and take them to corruption, fraud and falsehood. They acquire political bosses and supervise the strings of the Government. Thus the entire social structure comes to be badly polluted.
During the Second World War Black money as a matter of fact came into being. During war-time government imposed control on certain commodities. It gave good opportunity to people for making great profits. Since then it has been growing from year to year. The figures of black money have gone upto 22000 crores in our country according to the government sources. This echos the magnitude of black money market in India. This also bears testimony to the amount of corruption prevailing in the country and the illegal activities being carried out. The biggest means of creating black money is avoidance of income tax and sales tax.
The actual income earned by Most of the businessmen is never show. They either never manage any books of account or also keep false accounts to be shown to the authorities. As the result, the tax which is due to them is not paid. But the money they make out of their business keeps on compiling with them. After a stretch of time when their wealth increases to large amounts, they cannot show where this money has come from. This is black money. While shopping, most of us never ask for a bill from the shopkeeper or the dealer. We never realize its consequences. Crores and crores of rupees in sale tax is avoided because of absence of billing. Most of the dealers do not deposit the sales tax collected from the customers with the sales tax authorities. The system of Value Added Tax (VAT) is introduced by government whereby the sellers of goods are taxed for the value added. But even here, the actual sale shown by the dealers is much less than what actually is.
The other channel where which large black money created is through illegal trades. All income that is collected because of brown sugar, smuggling of gold, narcotics and other goods which cannot be sold is black money. The cost of these goods is so high that dealing in them makes billions of rupees. Since the dealings are illegal, the money is not genuine earning but black or illegal wealth. There are international smuggling rackets which facilitate this kind of trade.
I agree with the decision taken by our PM(Nerendra Modi) to ban high value currency which will definitely wipe out black money. It is a very bold move taken by the GOI. At present, the country is witnessing a change and every citizen should contribute. A little inconvenience today will result in good future. Have patience.
Jai Hind Jai Bharat.