Fifth Column: A bad idea

There is no point either in looking for black money abroad because it is usually not in bank accounts but in real estate and other assets owned by shell companies. So the tax inspectors will make many trips to foreign lands, as they did in pretend pursuit of Ottavio Quattrocchi, and come back with nothing. In frustration they will start harassing middle-class taxpayers travelling abroad for hard-earned holidays. Or as Sadanand Dhume put it so well in The Wall Street Journal, they will start ‘quizzing middle-class grandmothers on how much they spend while visiting their grandkids in Europe or the US’.

What the new law will also do is frighten away investors just as continued use of the awful retroactive law has already done. And, if investment does not pick up, there will be no creation of new jobs and no ‘Make in India’. There will be even less chance of investment picking up if the hunt for black money is pursued within India because every Indian entrepreneur is forced to have a little black money because of bad policies, corrupt politicians and very corrupt tax officers. Decades of ‘socialist’ policies have created a vast infrastructure of corruption that can only begin to be dismantled when power is reduced in the hands of petty officials. When you instruct them to go after black money, they will create an atmosphere so ugly that every paanwala and small shopkeeper will fall into the dragnet. Tax terrorism will acquire a whole new meaning.

India is a country of small entrepreneurs. They are creators of wealth and jobs as much as big entrepreneurs. Their businesses will crumble if tax inspectors get more power than they already have to harass them. Big industrialists have the means to fend tax terrorism off that smaller entrepreneurs do not. More importantly the message that goes out is that the creators of wealth are actually thieves who deserve to be in jail.

At a time when the Dynasty’s youngest child has come back from his sabbatical with a head full of old-fashioned Marxist ideas, the government has a real chance to take the opposite road. Instead of trying to pin ‘pro-poor’ credentials on his ‘suit-boot ki sarkar’, Modi should admit proudly that he wants the poorest Indians to be suited and booted. In the Congress worldview, workers and peasants must remain poor, dirty and in rags so that their great leaders can come and ‘alleviate’ their poverty.

The Prime Minister should not hesitate to say openly that a new economic direction is needed because the old one kept too many Indians mired in poverty for too long. He should go back to talking about bringing prosperity to India instead of merely ‘alleviating’ poverty. That is the kind of ‘parivartan’ and ‘vikas’ this country’s voters wanted when they booted out the most powerful Dynasty since the Moghuls.

A year ago today was the day after the election results gave India its first prime minister in 30 years to have a full majority. In the year gone by, Mr Modi has shown that he is a real leader in matters of foreign policy and in restoring the dignity of the Prime Minister’s Office.

He has also shown that he is ready to talk about India’s flaws from the ramparts of the Red Fort. But he has hesitated to improve governance by curbing the powers of the petty official. So the ordinary Indian still sees the ugly face of the Indian State whenever he comes into contact with officialdom or law enforcement. In the tax department, these two areas meld into each other, giving tax officials the right to raid people’s homes and make victims of these raids guilty till proven innocent. Is it wise to give them more power when they already have too much?

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