Says such a move will net $1.6 trillion to the government exchequer
Bharatiya Janata Party (BJP) leader Subramanian Swamy on Saturday said a key agenda of the National Democratic Alliance (NDA), if it came to power in 2014, would be to issue an ordinance to nationalise all bank accounts of Indian citizens in 70 countries that permit secret banking of hawala-converted black money. This would net about $1.6 trillion for the government revenue.
Dr. Swamy, a former Union Minister who recently joined Bharatiya Janata Party (BJP), suggested abolition of income tax as it had become a tool to harass middle class taxpayers and professionals. “If direct income tax is abolished, it will mean minimal paperwork for the people,” he told reporters.
He argued that the shortfall of about Rs. 2 lakh crore collected annually in income tax could be made good by auctioning spectrum, coal blocks and minerals, which would bring in much more revenue.
‘Abolish participatory notes’
Dr. Swamy also advocated confiscation and abolition of participatory notes of prominent hawala operators arrested under prevention of money laundering law. He favoured fast tracking of infrastructural projects by allowing 100 per cent FDI in them under the automatic route subject only to a strict national security clearance and a level-playing field for Indian competitors. “This will attract desirable FDI, empower local investors and enable enhanced value-added re-exports to the U.S. and Europe from India.”
Asked if his suggestions were approved by the BJP leadership, Dr. Swamy said that he was airing his views only after consultations with the party leadership who favoured a wider discussion on them.
He said that India’s household savings rate, which was the highest in the world in 2004, had fallen and was also shifting to hoarded non-financial assets. This was causing a fall in the growth rate of GDP as investment and employment declined.
Rise in corruption and reckless spending spree, through “leaky” schemes such as MGNREGA, and the Food Security Act during the United Progressive Alliance tenure had put the economy on ventilator. “Unless the economic situation is rectified by new reform policies, disaster and default of debt payments await the Indian people,” Dr. Swamy contended.
This story has been edited to incorporate the following correction:
The headline, “BJP will nationalise NRI bank accounts to check hawala” was erroneous as the report (Sept. 23, 2013) had clearly said that the party would nationalise overseas bank accounts of resident Indians to check hawala transactions if it came to power in 2014.