Current Affairs PDF

GFI ranked India 4th in black money outflows p/a

AffairsCloud YouTube Channel - Click Here

AffairsCloud APP Click Here

A Washington-based research and advisory organisation Global Financial Integrity (GFI) released its report titled “Illicit Financial Flows from Developing Countries: 2004-2013” showing a dramatic increase of illicit financial flows from 2004 when it was USD 465.3 billion to USD 1.1 trillion in 2013.
(Illegal financial outflows includes tax evasion, crime, corruption and other illicit activity)

  • Report ranked India at 4th place in black money outflows with USD 51 billion drawn out of the country per annum between the years 2004-2013.
  • China tops the list with USD 139 billion average outflow of illicit finances per annum, followed by Russia (USD 104 billion per annum) and Mexico (USD 52.8 billion per annum).

GFI ranked India 4th in black money outflows paThis study demonstrates that illicit financial flows are the most damaging economic problem faced by the world’s developing and emerging economies.

GFI recommendations to curb Illicit Financial Flows
GFI recommends that world leaders should focus on curbing opacity in the global financial system, which facilitates these outflows.

  • Governments should establish public registries of verified beneficial ownership information on all legal entities and all banks should know the true beneficial owner(s) of any account opened in their financial institution.
  • Policymakers should require multinational companies to publicly disclose their revenues, profits, losses, sales, taxes paid, subsidiaries and staff levels on a country-by- country basis
  • Countries should actively participate in the worldwide movement towards the automatic exchange of tax information as endorsed by the OECD and the G20.
  • Customs agencies should treat trade transactions involving a tax haven with the highest level of scrutiny.
  • Governments should significantly boost their customs enforcement by equipping and training officers to better detect intentional mis-invoicing of trade transactions.

GFI recommended that governments should sign on to the Addis Tax Initiative to further support efforts to curb IFFs as a key component of the development agenda.