Advani's adjournment motion on Black Money
BJP leader LK Advani on Wednesday moved an adjournment motion in the Lok Sabha on “situation arising out of money deposited illegally in foreign banks and the action being taken”. The motion fell through at the end of the day.When Speaker Meira Kumar put it to vote, the treasury benches shouted ‘ayes’ when they should have said ‘nays’, which they did after the amusement all round. Samajawadi Party members led by Mulayam Singh staged a walk out. Advani admitted that earlier black money was generated due to higher rates of taxation, going up as high as 97.5 per cent. He said credit was due to former prime minister PV Narasimha Rao who opened up the economy in 1991 and ended the licence-permit-quota raj. He also said prime minister Manmohan Singh, who was finance minister with Rao, helped in changing the system. Advani, however, went on to say that tax evasion had increased many fold after liberalisation. He said that with Switzerland and some western banks ready to disclose information on illegal accounts, the government should turn pro-active and retrieve the illegal money stashed away by Indians amounting to a few hundred billion dollars, which could then be invested in the six lakh Indian villages. In his reply, finance minister Pranab Mukherjee said the figures cited by Advani and other opposition leaders were not based on reliable sources, and that he has tasked three institutions to arrive at an accurate figure. He told the House that the agreement with Switzerland on sharing information tax evaders would come into effect only from 2012, and that it will be prospective and not retrospective. That is, it will only apply to tax evaders in the future, and it will not be possible to get information from the past. He also said that name of no member of parliament was in the list of those holding illegal accounts in foreign banks, and that India does not even figure in the top 10 countries on the list of ‘dirty money’ which is what ‘black money’ is known as in the west. Mukherjee also pooh-poohed the idea that black money in foreign banks should be declared a national asset. He said it will not be possible to invade another country to retrieve the national asset. The finance minister emphasised that India will have to work with other countries within the international legal framework. He reminded the House that prime minister Singh had emphasised in the G20 meeting that there should be an automatic exchange of tax information among this group which will encourage other countries to fall in line as well, and that it is wrong to say that the government is not doing anything in the matter. He said that tax evasion is not a criminal offence which is to be dealt under the Criminal Procedure Code, and that the norms of pursuing the tax evaders have to be different. He also told the House that Indian entrepreneurs are investing abroad, and India is the largest investor in the European Union and second largest in the United Kingdom. He revealed that black money is neither new nor urgent which is what an adjournment motion should be about, but he said he conceded to the demand because he wanted the House to run.