|There is a new income disclosure initiative that is on in the United States of America. The Internal Revenue Service (IRS) calls it the 2011 Offshore Voluntary Disclosure Initiative (OVDI). Failure to disclose assets offshore before August 31, 2011 will attract severe penalties. Participants must pay back-taxes and interest for up to eight years as well as become liable for paying accuracy-related and / or delinquency penalties.
It is well known that Indian Americans top the list of median family income in the United States, ahead of all other ethnic groups, immigrant communities and local, naturalized and native Americans. The new initiative, therefore, threatens to impact directly several economically successful Indian businesses and professionals. Some of them face the dire prospects of paying up millions of dollars in penalties for having invested in tax-friendly nations and islands in Europe and in the Atlantic Ocean, and elsewhere.
The IRS is squeezing banks in America to disclose transfer of assets to offshore accounts. Unsurprisingly alarm bells are ringing in businesses across the country. Our story this week looks at the joint appeals issued by four powerful Indian entities to the U.S. Government to give more time for such disclosures to be made. Else many businesses face the prospects of being wiped out, since penalties can be very high.
In an American economy that is stepping up austerity measures to battle slower growth rates, lesser national revenues, higher unemployment, burgeoning social security bills, the OVDI was not entirely unexpected. What it'll do, though, is make people insecure about their future, and severely test their ability to withstand minute scrutiny of their financial statements. It goes without saying that if Indian Americans are affected, then many families in India will be affected as they rely on dollar remittances, especially parents whose children live in the USA. Naturally, Indian organizations in the USA have stepped up the campaign to make the IRS go slow on its OVDI, and extend all deadlines till December 2012. We have an interesting phase on our hands.
Away from the sometimes grim world of economics, our magazine had the privilege of interacting with a perky group of British Indian school boys (all aged 17) who were in India to work with a charity known as Wings of Hope, headed by Rajni Sri Ram. The charity which does some excellent work and has high credibility in the U.K. funds a school in Chennai with nearly 400 students, and other such projects in Africa. The PIO boys went through a rigorous competition before they were selected to tour India, and we found the cause worthy enough to merit honest attention.
In our last two issues we focused on Indian students in America capturing the imagination of the nation by winning the National Spelling Bee and the national science competitions. We continue to track youth. In this issue we look at a story that talks about young Indian American actors that are drawing popular and critical attention.
There are a slew of other stories that I'm sure you'll enjoy. Do send us your feedback, as often as you can.
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