Many countries' governments in the world levies tax on the citizens as a payment to the government. This tax imposition is done so the money collected as income tax can be used as a part of government projects for the sake of people. Not all transactions are recorded. The undocumented ones are being transacted by illegal means and that is called Black Money. There are many reasons as to why it is deemed illegal and the country with high rates of such transactions suffer losses. Below, we will explore the ways to write an Essay On Black Money In English. It can be a Long Essay On Black Money or a Short Black Money Essay.
Long and Short Essay on Black Money in English
Short Essay on Black Money
Let us take a look at the Black money essay which is a brief note about the meaning and the sources and how it affects the economic state of the country.
In India, like many other countries in the world, every citizen who earns above the minimum wage must pay tax to the government. The tax to be paid must also be confined to all the documents on monetary transactions. This is a rule every citizen must abide by, and yet some people manage to find loopholes in the set rules.
These irresponsible citizens also try to fool the government and practice illegal black money transactions. The ones who avoid such taxation are the highest-earning powerful officials like politicians and businessmen, other individuals try to evade taxation like criminals and smugglers. All funds obtained through illegal transactions are called black money, which they try to convert to legal earnings via money laundering.
The consequences of this practice are catastrophic because it directly affects the economic and financial health of the country. There will be no growth and improvement, therefore, for the people who live life by the means of honest earning face the consequences. Fighting against black money should be a collaborative effort only then we could eradicate this issue.
Long Essay on Black Money
In this essay on black money, many important points can be covered like the effects, both advantage and disadvantage and how one can handle this problem.
In any country, it is important to have laws that monitor and ensure the growth of the people along with the growth of the country. One such law is the tax law. In India, there is a certain amount of income that has to be exempted from tax and that amount is solely dependent on the earnings and the spendings. All of which should be taken into consideration and documented even the loans, insurance etc. This is the legitimate practice to be followed.
Any practice that has been done illegally, or illegitimately and hiding away the money from paying it to the government is a threat to the country’s development. For instance, when you purchase from a store and pay in cash but do not receive a store receipt from the store since the money earned by the store is not documented, it becomes black money because no tax can be paid on unrecorded sales.
Black money is often cash operated.
There are many countries and territories in the world where tax is not imposed like the United Arab Emirates, Monaco, Bermuda, Bahrain, Brunei, Kuwait, Oman and Qatar. They live in tax-free land and evidently, it is working because the government still soars high in making progress economically.
The benefit of Black Money- Like everything else, this illegal activity has certain benefits. Even though in the Soviet Union where black money is considered illegal, the practices occurring were mostly in the underground black market. But it proved to be quite useful in this oppressive nation. When the nation was suffering from economic losses, the government turned to the underground market and used it legally to make the country again a contender in the economic market.
Disadvantages of Black Money-
Since all such transactions are unrecorded they go unnoticed and the corruption in the nation increases.
When the corruption rate grows higher, all heinous acts also rises like terrorism, gunrunning, human trafficking, selling of prohibited alcohol and drugs or any commodity that is harmful also increases.
The law enforcement weakens and even the lawmakers like the policemen fall prey to such a corrupt system.
With no stricter laws, corruption and the black money market cannot be stopped from growing.
Financial leakage occurs and the government loses revenues.
Such financial loss alleviates the underestimation of the country’s gross national product.
With such loss at micro levels, macroeconomics suffers and is varying constantly.
Ways to Tackle- The best way to handle this is to cooperate with the law and the government. This should be the teamwork of the citizens and the lawmakers. Our government has taken a huge step in the right direction towards stopping the flow of black money. Demonetization was enforced that stands for stripping a particular denomination currency, as illegal. So all the stacked up illegal money no longer held any value and had to be returned and exchanged from the RBI that is the Reserve Bank Of India or discard completely.
Demonetization was the right move by our government, but there is no denying that we as a nation still have a long way to go before we are free from corruption. There should be an implementation of stricter laws, anyone who tries to bribe must be fined or arrested. There should certainly be clear monitoring and removal of the existing loopholes that further such illegal acts. Another attempt to uproot this problem should be made and laws must be changing so the country’s growth is not hindered. People must be alert and cooperative and immediately report any such practices. Tackling this issue will certainly bring equilibrium to financial and social imbalance.