BLACK MONEY AND TAX AMNESTY: THE EFFECTIVENESS OF TAX AMNESTY SCHEMES IN HANDLING THE MENACE OF UNACCOUNTED INCOME IN INDIA

The question of whether we can entirely eliminate black money in existence is challenging. However, one can argue that we can endeavour to bring much of it within the system. One of the many methods that have been suggested for quite some time is tax amnesty schemes. In India, tax amnesty schemes have been in existence for a long time, and though they have been refashioned under different names, they have become a preferable method of encouraging tax evaders to pay their dues in consideration of certain relaxations.Tax Amnesty schemes are aimed at drawing out tax evaders and bringing the unaccounted money into state treasury. Despite the noble objective behind their operation, many argue that these schemes do more harm than good. However, in order to determine the efficacy of these arguments it becomes imperative to analyse the history of these schemes in India and how they have fared in reality. This article attempts to cover the history of tax amnesty schemes in India and evaluate them on a number of factors, particularly moral and economic grounds, so as to determine whether they have been effective in handling black money in the country.