tax evasion. a case

5390 Words22 Pages
A case on tax evasion by Anurag Kashyap

Introduction

Tax evasion is the illegal evasion of taxes by individuals, corporations and trusts. Tax evasion often entails taxpayers deliberately misrepresenting the true state of their affairs to the tax authorities to reduce their tax liability and includes dishonest tax reporting, such as declaring less income, profits or gains than the amounts actually earned, or overstating deductions. Tax evasion is an activity commonly associated with the informal economy. One measure of the extent of tax evasion (the "tax gap") is the amount of unreported income, which is the difference between the amount of income that should be reported to the tax authorities and
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The word “concealment” is not used in the context of prosecution either under the present Act or the proposed legislation. But there are provisions to tackle defaults of every kind. As regards penalty, the Code provides for levy of penalty automatically, wherever there is a difference between reported and assessed income. The removal of the word “concealment” takes away the need for inference of intent to keep back any information relating to assessment. The law in the Code makes no difference between the deliberate delinquency and the innocent omission so that the Code, as in most other aspects, is more stringent on the taxpayer.
India loses 14 trillion rupees ($314 billion) from tax evasion annually, depriving it of funds for investment in roads, ports, and power, says Arun Kumar, author of The Black Economy in India. General government tax revenue is an estimated 18 percent of India’s $1.5 trillion in gross domestic product, the lowest among the four BRIC nations, International Monetary Fund data show. With so little revenue coming in, Prime Minister Manmohan Singh is now attempting India’s biggest overhaul of the tax code in half a century.
Investors say tax reform would boost their confidence. “If the government does end up making a substantial amount in revenue as a result of the tax overhaul, their deficit requirements should come down and the interest
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