The "underground" millionaires
When talking about millionaires, people often think of businessmen who dress elegantly, have precious jewelry on their hands, own private jets and often carry briefcases to fancy restaurants to drink wine.
Many street vendors in India have been found to be "hidden millionaires" for tax evasion (Illustration: Economic Times).
Yet in India, hundreds of seemingly ordinary citizens have secretly become millionaires, hiding behind a veil to challenge caste prejudices and the country's Income Tax Department.
A few years ago, India's information technology department discovered that more than 250 street food vendors and scrap dealers were actually millionaires in the northern city of Kanpur.
The group includes fruit and vegetable vendors, small drug store owners, grocery sellers, waste pickers and sanitation workers. They have been getting rich by evading taxes for years.
Specifically, these "millionaires" have saved and spent a total of more than 37.5 million Indian rupees (more than 12 billion VND) to buy real estate. Among them, many business households have bought large agricultural lands near the rural areas around Kanpur. Some scrap dealers also own at least 3 cars.
However, the secret transactions were soon exposed in an investigation using big data software. The group was caught when one of them used details from a PAN card (a number used to identify bank accounts including debit and credit accounts).
Despite being poor, many street vendors in India own a lot of real estate (Illustration: Reuters).
Authorities found that the group had not paid any taxes other than registering for the Goods and Services Tax (an indirect tax levied in India on the supply of goods and services). Among them, at least 65 grocery store owners and pharmacists had not even registered their businesses.
Some people even disguise their millions by buying real estate under the names of multiple family members. Others rely on cooperative banks and microfinance programs.
Undisclosed earnings
According to Indian officials, this is not the first time that authorities have discovered a way for street vendors to become millionaires.
In 2016, dozens of street food vendors in Kanpur were arrested for failing to declare their income of 600 million rupees (about 173 billion VND). At the same time, a group of people in Hyderabad (southern India) were also discovered using a similar trick.
With over 600,000 street vendors, they are an essential and legitimate part of India's urban retail trade and distribution system.
They represent 4% of the urban workforce across the country and provide daily necessities to citizens. Street vendors have a parallel turnover of approximately 800 million rupees/day (more than 2,454 billion VND).
Street vendors contribute a lot in providing necessities to citizens (Illustration: Live Law).
According to the Times of India, in June 2019, the tax authorities conducted a surprise inspection of a bakery in India. The authorities discovered that the owner could earn 60-70 million rupees/year (about 17-20 billion VND/year).
Mukesh Kumar, the shop owner, said he has been in business for about 12 years. With the above income, Kumar had to pay up to 3.5 million rupees (about 1 billion VND) in taxes, but he did not declare it because he did not know the regulations.
Street vendors typically work more than 12 hours a day and regularly face class discrimination, bureaucracy and threats of deportation.
Although the Indian government passed the Street Vendors Act in 2014 to protect street vendors without permanent outlets, they still have to deal with issues like harassment and licensing restrictions. In Mumbai, for example, the government has issued only 15,000 licenses for 250,000 street vendors. The rest are forced to sell their wares illegally.
Source link
Comment (0)