Corruption | Black Money in Swiss Banks | Full Coverage story

Corruption after corruption.Hardly any day is there when the word corruption doesnt strike our ears before we take a sip of our morning tea.
Anyways, I have pen down this article to make clear everything related to our country's black money being stashed away in swiss bank accounts.Lets start from very basics.
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What is swiss account ?

Banks in switzerland are referred to as swiss banks.And accounts opened with them are Swiss account.All Swiss banks are regulated by the Swiss Federal Banking Commission and serve clients from all over the world.Any one can open account with swiss bank just like any other bank.You need not be a millionaire..






Why black money holders deposit only in swiss banks ?

Well, the answer lies in the following three feature:

Complete Privacy : (Swiss law prohibits bankers to reveal the existence of your account or any other information about it without your consent; except in criminal proceedings);
Breach of confidentiality could result in bankers facing up to six months in prison and a fine of up to Swiss franc 50,000. And, you have the option of suing the bank for damages.
Swiss banks are very careful about protecting your privacy. The only exceptions to the Swiss banking privacy rule are criminal activities such as drug trafficking, insider trading or organised crime.

Low risk : (Switzerland has an extremely stable economy, well-built financial system and infrastructure for many years and hasn't been at war with any other country since 1505).

Good returns:  Swiss bankers are well skilled in investing and know how to grow your money.Swiss bank accounts pay higher yields than other money market accounts.

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What is black money ?
Black money refers to moneys,properties etc which are held and enjoyed by persons who do not account for it under Law,escaping tax liability on the same.Examples of such black money can be found in benamy transactions in sale/purchase of properties.Also various trade malpractices resulting in suppression of income earned can accumulate black money.
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Now,Whats the Current situation ?

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• According to the data provided by the Swiss bank, India has more black money than rest of the world combined. India topping the list with almost $1500 Billion black money in swiss banks, followed by Russia $470 Billion, UK $390 Billion, Ukraine $100 Billion and China with $96 Billion.
  
• The money which belongs to the nation and it’s citizens, is stashed in the illegal personal accounts of corrupt politicians, IRS, IPS officers and industrialists.
• An amount which is 13 times larger than the nations foreign debt. Every year this amount is increasing at a rapid speed but the Indian government seem to be silent over this matter from a very long time. 
• The total black money accounts for 40% of GDP of India, if all the money comes back to India then that could result in huge growth burst for India.
• A nation where more than 450 million live below the poverty line, which means they make less than $1.25/day. By bringing back the black money back to the country there is so much which can be done for the development of the nation. India will also be able to clear all their foreign debts in 24Hrs.
• Even if all the taxes are abolished, the government can maintain the country easily for 30 years.
• It’s been found that about 80 thousand people travel to Switzerland every year of whom around 25 thousand travel frequently. Those travelling on regular basis must be doing it for some reason.

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So, Whats the problem ? Why Culprits are not caught ?

• Now since I told you before that swiss banks have the rule of total confidentiality of the account holders details, investigations are hindered.The corrupt politicians cannot be named as their names cannot be disclosed by the switzerland govt.
•  Finance Minister Pranab Mukherjee and Swiss Federal Councillor Micheline Calmy-Rey signed a "protocol" on August 30, 2010 to amend the double taxation agreement (DTA) in the area of taxes on income.The revised tax treaty was expected to facilitate the Indian government seeking details about illicit wealth allegedly stashed away by Indians in Swiss banks.
• However, this Protocol has not entered into force yet and needs to be ratified by the authorities in two countries. If all these ratifications are achieved by 2011-end, the provisions of the treaty, which includes information exchange about suspected tax evaders and other financial offenders, would come into effect in India from the fiscal year beginning on or after first day of April 2012.
• This means that India would be able to seek information on tax evasion and other financial offenses on incomes for the fiscal year 2012-13 beginning April 1, 2012, onwards and not for the past periods.
• The revised tax treaty agreement was reached after months of negotiations, even as the Swiss banks have said that they would not permit “fishing expeditions” - meaning unwarranted and indiscriminate trawling through bank accounts in the hope of finding something interesting.
• The Swiss Bankers Association have previously said that any information exchange would be according to the conditions set out by the Organisation for Economic Cooperation and Development (OECD), the grouping of mostly developed nations, and the information being sought should be specific in nature.
• As per the revised treaty, Switzerland would now provide administrative assistance in tax evasion cases also, in addition to the tax fraud cases applicable earlier.

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