Q.3 What are the consequences of illicit financial flows to the economies? What are the challenges in curbing illicit financial flows? (10 Marks)

Mentor’s comment-
  • https://www.thehindu.com/opinion/lead/taking-the-lid-off-illicit-financial-flows/article36974015.ece
  • In the intro, mention the recent publication of Pandora Papers exposing once again the illegal activities of the rich across the world.
  • In the body, mention the effects of illicit financial flows like impact on government revenue due to tax evasion, lowering of tax rates by the governments to attract the capital leading to race to the bottom, moving money out of the reach of the creditors, terrorist financing etc. In the difficulties mention loopholes in the laws, lack of intent on the part of rich countries as these countries are the beneficiaries of these fund movements, actions of the perpetrators are sometimes outside the purview of Indian tax authorities.
  • Conclude by mentioning the need for a global minimum tax rate and ending the banking secrecy.
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muskan garg
muskan garg
1 month ago

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ARPITA
ARPITA
1 month ago

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Siddharth CHATURVEDI
1 month ago

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Ashok Meena
1 month ago

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Liya Rose Kurian
Liya Rose Kurian
1 month ago

Illicit financial flows.

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k.s.nandhini
1 month ago

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