In a report released by US-based think tank Global Financial Integrity (GFI), India has been identified as the number three country in trade-based illegal financial transaction. The government of India already lost $83.5 billion as tax to money laundering relating to trade. According to GFI, illicit funds are those earned, transferred or used illegally and are often obtained through corruption, tax evasion, drug deals etc. Among 135 countries, the five with the largest trade-based financial crimes, identified with value gaps were China at $457.7 billion, Mexico at $85.3 billion, India at $83.5 billion, Russia at $74.8 billion, and Poland at $66.3 billion. Rick Rowden, an Economist said that a good way to view the value gaps identified for India is the amount of trade that was not properly taxed by the government of the importers and exporters involved. With this, the GFI believes that the practice of misinvoicing is a huge one as it has the ability to lead to large amount of trades not properly taxed.
March 5, 2020 by Media Team in ML/TF updates