Thursday, September 27, 2012

The black and white of money

Many people talk about black and white money. Here is my understanding of the same -

  1. Black Money- this is the money which people claim to have spent (or not earned) but do not - So effectively this is the money they do not have. Like a businessman may claim that their sales and profits were lesser, to save on tax. So whatever amount that is under reported becomes black money.
  2. White Money - Money earned and accounted for. Like salary coming in the bank account.

Now the interesting part, how to make your black money- white and vice versa.

  1. White to Black - 
    1. NGO donation - Donations to NGO are tax exempt. Many NGO just take a cheque of white money and give you cash. This is done at some service charge.
  2. Black to white
    1. Someone gives you a cheque against cash. This can be shown as payment received against some service or product.
As the economy is one whole, so white to black is balanced by those wanting Black to white.

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