Whither black money if money in Swiss banks is not black?

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The news that money parked by Indians in Swiss banks grew 50 per cent while secret deposits by other global depositors grew by just three per cent, has pushed the government on the back foot with Finance Minister Piyush Goyal and Union Minister Arun Jaitley wondering how all this money could be “assumed to be black”.

If Swiss money deposits by Indians is not black, where has all the black money gone? Was it another “jumla” if seen in the light of famous rhetoric that if NDA was voted to power it would bring back every paisa stashed in Swiss banks? It is strange how this has happened despite demonetisation which was touted as a crucial weapon in the fight against black money. If all money parked in Swiss Banks is not black money, shouldn’t we stop labeling the wealthy as tax evaders and instead encourage them to invest their funds in India in public interest?

It was expected of opposition Congress to come down heavily on government’s claims of fighting against black money, but what could hurt the government is its own leaders and allies criticising it. Rajya Sabha MP Subramanian Swamy wrote on his Twitter handle, “Major success of Finance Secy Adhia. Secret Swiss Bank accounts deposits from global sources rose by 3 per cent last 12 months. Indians deposits however grew 50 per cent. Adhia would have managed more if Rajeshwar was not a distraction”. Even KC Tyagi of JD-U, BJP’s ally in Bihar, called the trends “worrisome”, saying everyone had hoped black money would be curbed post demonetisation. CPM’s Sitaram Yechury and CPI’s D Raja also attacked the BJP for “waiving off corporate loans and allowing fraudsters to flee with bank monies”.

The government put up a strong face with Goyal promising action against those guilty of holding black money and Jaitley writing a blog pointing out that to assume all deposits are per se tax-evaded money or that Switzerland in the matter of illegal deposits is what it was decades ago is to start on a shaky presumption. The flow of information from Switzerland will start from January 2019.

Any illegal depositor knows it is a matter of months before his name becomes public and he will be subjected to the harsh penal provisions of the black money law. Time has come for the government to re-establish its sense of sincerity about its commitment to weed out black money. It needs to accelerate the pace of investigations in all cases by prosecuting all those who have violated the law. Nothing short of that will work to bring favourable public perception like the famous lines from Christopher Marlowe’s play Dr. Faustus “All is dross that is not Helena”