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Britain: Imperial sanctuary for economic offenders of the Commonwealth
The Vijay Mallya Incident: Mr. Vijay Mallya, Indian business tycoon and liquor baron is an economic offender. He has been declared willful defaulter of about Rs 9000 crores (approximately $1.5 billion) by a consortium of 17 Indian public sector banks. He is also facing criminal charges of money laundering, issuing a check without adequate funds in his account, fraud, and not depositing service tax and provident fund collected from employees of his company, the Kingfisher Airlines.

He fled to Britain on a valid visa and passport in March when asked to appear for questioning by Indian authorities. He has since failed to respond to summons in India. The Government of India cancelled Mr. Mallya's passport in May 2016 and requested the British Government to deport him. The British Government has refused to do so citing certain laws.

Britain as a Tax Haven

Britain has the unsavory reputation as a haven for dirty money. Many overseas politician, public servant, oligarchs, drug lords, smugglers and tax cheats from all around the world have parked their bribes, kick backs and laundered funds in British tax havens. 

For example, James Ibori, a former governor of Nigeria's Delta State, was jailed for 13 years in 2012 after pleading guilty at a court in London to money laundering and fraud offences involving up to $225m from the Nigerian public exchequer. He allegedly bought four homes in Britain, including a $3m mansion. Nigeria wants the money returned. UK is non-committal.

According to the anti-corruption group Transparency International, some 36,000 homes in London are currently registered as being owned by firms in offshore tax havens such as the British Virgin Islands. The UK laws do not require the registration documents to reveal the real identities of the buyers.

The British Newspaper, the Guardian on 12 May 2016 has quoted a research which has revealed that 389 companies listed on the London Stock Exchange with a market capitalization of about US$375 billion are based in tax havens located on the Channel Islands, the Isle of Man in UK and British Virgin Islands.

A study of 33 African countries revealed that they lost over $1 trillion in capital flight since 1970. Of the amount $640 came from 16 Commonwealth countries. Rules requiring firms in offshore tax havens to declare who the real owner of a home are much overdue in the UK. Panama Papers have listed about 2000 Indians as having accounts, business entities or trusts in tax havens, mostly in the UK.

An estimated 3,000 wealthy Indian families own luxury properties in the famous London district of Mayfair. As per the Daily Mail of the UK, Indian investors spent around $ 1 billion in buying residential properties in and around Mayfair in 2015. Since the emergence of the Panama Papers, the UK prime minister has been under pressure to invoke special powers to force British tax havens to make public the true details of the account holders. He had earlier blocked attempts by EU to close down the tax havens.

In a belated attempt to improve its image, UK PM David Cameron hosted an international anti-corruption summit in London in May 2016. He said that new laws will be enacted that would enable the UK police to force the buyers to reveal the source of their income. The new rules would apply in particular to politicians or civil servant. Nothing is mentioned about businessmen and tax cheats or when the law will be tabled. There is also no mention about the tax havens or if the government plans to deal with them.

Britain as a Sanctuary for Indian Economic Offenders and Tax Cheats

The UK allows dual citizenship. It also allows Indian and other Commonwealth country's citizen to vote in the UK if they have stayed for more than six months and have registered for voting. Such Indians are also issued British passport at their discretion as they have done in the case of FEMA violator and economic offender, Lalit Modi.

In Vijay Mallya's case, the UK government refused to deport Mallya because he has not committed any crime in the UK. In other words, Indian criminals and economic offenders have a safe sanctuary in the UK as long as they park their ill-gotten wealth in British banks or tax havens and behave prudently. There is another disturbing trend. Many Indian businessmen are relocating themselves to the UK to avoid being liable to Indian laws and tax regime.

Britain has historically shown great disdain for ethics and fair play when dealing with Asian and African countries. It fought two wars with China to obtain the right to sell opium in China. It enthusiastically took part in the North Atlantic slave trade. It forced the farmers of Bengal to grow Indigo in place of rice which led to the famine of 1942. It now acts as the sanctuary for economic offenders of the developing world.

What should India do?

India is not a banana republic. It is the world's largest market for consumer goods. It is the world's fastest growing large economy and a peaceful and safe investment destination where rule of law largely prevails. India should give an ultimatum to UK Government to immediately deport Vijay Mallya, Lalit Modi and any other Indian economic offender who has taken shelter in the UK.

It must also ask it to give details of accounts of Indians in British tax havens within six months. In case the UK refuses to comply, India must take the following steps. Immediately withdraw from the Commonwealth. This will make it more difficult for the UK authorities to issue British passport and other facilities enjoyed by British citizen to Indian economic offenders. It may encourage Nigeria to follow suit and put more pressure on the British Government.

Stop Indians from going to the UK as tourist after six months. Also stop Indian students from enrolling in British universities. The passports of all Indians traveling to the UK as tourist or for studies should be immediately cancelled. The Indian passports of NRIs who are not working but doing business should also be cancelled. If the UK government still refuses to act, stop all companies registered anywhere in the UK from investing or doing business in India. They should be ordered to sell their assets and get out within one year. The companies should be nationalized if they fail to do so. It has been done by Indira Gandhi in the past.

Conclusion

Mr. Modi became Prime Minister with the promise of bringing back all the black money our greedy, corrupt, anti-national Indian politicians, celebrities and super rich have stashed away at tax havens abroad. That goal has long been discarded citing various legal difficulties. Now the goal of the Modi Government seems to be to make it easier for Indian politicians, super rich, criminals, tax cheats and economic offenders to flee abroad with their ill gotten loot.

India is a soft state. Nepal makes eyes at us. Sri Lankan Navy arrests our fishermen and we do nothing to protect them. Pakistan keeps doing cease fire violations killing and injuring Indian citizen. We do not know how to protect our citizens. We have a Prime Minister with a 56 inch chest. But does he have the courage of the diminutive Lal Bahadur Shastri or Indira Gandhi to act tough with world powers? Time will tell.

Editorial NOTE: This article is categorized under Opinion Section. The views expressed in this article are solely those of the author and do not necessarily represent the views of merinews.com. In case you have a opposing view, please click here to share the same in the comments section.
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Debaloy Mitra
When someone commented about Mr Vijay Mallya and that that Britain has become Imperial scantuary for economic offenders. So in that case I must say India seems to be a paradise for corruption. It seems that Mr Vijay Mallya has become the topic for this month and now before I give my comment on Mr Mallya which is is very different and few of you might not agree ,however before that let me remind about Satyam scam of rupees 14000 crores Commonwealth scam of rupees 70000 crore and WAKF board land scam which is almost 12 times more than that of Mr Mallya and this is just 3 out of top 20 scams in India and let me ask you all a question that what these People related to the above three scams have given to a common public. I feel nothing, but what Mr Vijay Mallya has given us is India's first luxury airline designed for common people, the Buddh circuit brought F1 racing to India's map not only he showed old people how to age with style but also told the world that India too can have the quality of Spain and Germany in matter of beer at affordable price. Mr Mallya attempted the things when everyone was playing safe. Now I am no one to judge of him being right or wrong at present without knowing the indepth facts. All I know is when someones Good deeds surpasses its bad ones, that person certainly deserves another shot.It made me think that it's funny how tough time a father and brother has to struggle for just 3 to 5 lakhs of loan for education, hospital for financial support for his family and the irony is that he has to show a good amount of asset for it , I mean if you have good amount of asset why would one need such small loans!. I think all schools and hospitals should be targeted first who take crores of money in name of the donation and a middle class mother who's kid is brilliant in studies is not even let to enter the gate of premium schools. A certain class of people can donate millions of rupees or gold to temple, churches etc. where there is no control or clue on how it's been used, but cannot spend it for Welfare of people or animals.We say smoking kills and not to pollute air, and here i saw few months back Jaguar cars proving that there car’s exaust smoke is far cleaner than the air of few metro cities in India.wow. Let's not take the easy way by saying stop this …..that...I m little doodle duu n I suggest to stop those too...rather than brainstorming and putting a creative solution to action. Two quick questions: isn't India's tax system so frustrating that it pushes person to mental state that he doesn't wants to pay(and countries far rich than India in GDP has much lenient tax system), secondly...rich criminals….so...who exactly made them richer?
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