Question

What is black money? Write the causes of black money​

Answer 1

Answer:

Black money is money on which tax is not paid to the government. ... The portion of a country's income tied to black money affects the economic growth of the country. Black money causes financial leakage, as unreported income that is not taxed causes the government to lose revenue.

Answer 2

‎ ‎ ‎ ‎ ‎ ‎ ‎ ‎ ‎ ‎ ‎ ‎ ‎ ‎ ‎ ‎‎ ‎ ‎ ‎ ‎ ‎ ‎ ‎ ‎ ‎ ‎ ‎ ‎ ‎ $\underline{\large{\textsf{Black Monkey }}}$

Black Money is funds earned on the black market on which income and other taxes have not been paid. It is an unaccounted money.

$\large{\underline{\textsf{causes of black money :}}}$

Shortage of goods :

• Even if it is shortage occurring naturally or created artificially, it is the root cause of black money.

Licensing proceeding :

• Permit, quota, license all these are associated with maldistribution of commodities in short supply which results in black money.

Contribution of the Industrial sector :

• For example the controller of public limited companies tries to buy commodities at lower prices and bill them at high amount and the balance goes to them personally.

Smuggling :

• Precious metals like gold and silver, electronic goods, textiles were levied heavy excise duty. To avoid paying these duties, smuggling is done illegally that results in black money.

Tax structure :

• When tax rates are high, tax evasion naturally arises that leads to generation of black money.