Tax Dodgers See India Government Revenue Down $85 Billion

by Robert Lee, Tax-News.com, London

13 November 2001

Details of a leaked police document that was recently presented to Home Minister Lal Krishna Advani have revealed that tax-dodgers in India are cheating the national government out of $85 billion dollars in tax collections every year which, according to the Pioneer newspaper, accounts for nearly a fifth of the country's GDP.

'If 50 per cent of this income is tapped,' said the newspaper, 'then government revenue is likely to go up by 2,000 billion rupees ($42.5 billion) in a single year.' Ironically, the number of court cases brought against the tax-dodgers is decreasing. Pioneer quoted the document as stating: 'Just two years back, 5,674 searches were made in India and the total value of assets seized was 4.1 billion rupees ($88 million). However last year only 2,946 searches were conducted and assets seized valued at 2.5 billion rupees ($43 million).'

Lasst week India's Central Bureau of Investigation (CBI) arrested Chief Commissioner Someshvar of the Central Excise in Delhi for allegedly accepting a bribe of Rs 10 lakh. It is believed that Someshvar demanded the industrialist provide the bribe as settlement for a pending investigation on sales tax. His arrest is being hailed as a victory for the CBI in a crackdown against corrupt but influential government officials.

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