International Journal For Multidisciplinary Research

E-ISSN: 2582-2160     Impact Factor: 9.24

A Widely Indexed Open Access Peer Reviewed Multidisciplinary Bi-monthly Scholarly International Journal

Call for Paper Volume 7, Issue 4 (July-August 2025) Submit your research before last 3 days of August to publish your research paper in the issue of July-August.

Black money Crisis in India and Its parallels to Reaganomics

Author(s) Mr. Siddharth Kambhampati
Country United States
Abstract This paper examines black money in India as an outcome of institutional design, where tax complexity, enforcement asymmetries, and behavioral incentives shape participation in the formal economy. Despite headline efforts like demonetization, which temporarily increased tax filings, the underlying drivers of non-compliance remain intact. Through a population-based model of the tax gap, this study estimates that nearly two-thirds of India’s taxable population does not file returns, even when economically eligible. Rather than framing this as evasion in the traditional sense, the analysis views it as a structural mismatch between tax policy and taxpayer engagement. In response, the paper proposes a framework centered on simplified marginal rates and targeted sectoral reforms, particularly in real estate and micro, small, and medium-sized enterprises (MSMEs), to make compliance more accessible. While global proposals, such as Zucman’s minimum billionaire tax, reflect broader momentum, India’s long-term progress depends on reforms that reduce friction and rebuild trust in the tax system.
Keywords Black money, Tax Compliance, Institutional Reform
Field Sociology > Economics
Published In Volume 7, Issue 4, July-August 2025
Published On 2025-07-20
DOI https://doi.org/10.36948/ijfmr.2025.v07i04.51534
Short DOI https://doi.org/g9t2bp

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