Why I ran away to DUBAI

Here's a detailed summary of the YouTube video transcript:

1. The "600 Cr Scam" and Unrealistic Promises in Trading

The speaker addresses a recent video about a "600 Cr scam" involving trainers making unreasonable promises to people, suggesting they can become very rich through their classes. These trainers often claim that attendees can make over a crore from an initial investment of 1.5 lakh rupees, showcasing flashy purchases like bikes and cars.

• Key Point: The speaker emphasizes that no one can guarantee unreasonable returns in the stock market. If such high returns were consistently achievable, individuals with such skills would approach large investors like Ambanis and Adanis, rather than seeking small amounts from retail investors through workshops.
• Supporting Evidence: The speaker shares personal anecdotes where friends suggest he's "stupid" for not profiting from training, but he maintains his stance against making such exaggerated claims. He contrasts this with his own workshop attendees who have achieved success, like building a house from trading profits, but he never advertises these testimonials.

2. Speaker's Approach to Training and Promotion

The speaker outlines his distinct approach to training and promotion, differentiating himself from those involved in scams.

• No Paid Promotions: He explicitly states he never advertises or promotes his workshops through paid channels. He only informs people via YouTube and social media.
• No Testimonials: He refrains from showcasing testimonials from workshop attendees, even though many have performed well.
• Focus on Strategy, Not Systems: He teaches strategies for different market scenarios (bullish, bearish) and how to adjust and "firefight" when things go wrong, rather than providing a guaranteed system.
• Advice: His simple advice is not to believe anyone promising ultra-high profits.

3. Case Study: International Financial Services and the 6% Monthly Return Scam

A specific case is detailed involving a company called "International Financial Services" in Tamil Nadu.

• The Scam: This company reportedly collected money by promising a 6% return per month from stock market trading. Additionally, they offered a 2% monthly commission for referring new investors, totaling 8%.
• Logical Flaw: The speaker highlights the illogical nature of this promise. If someone could consistently generate over 15% return per month (6% for the investor + 2% commission + covering taxes and operational costs), they would approach large investors, not retail ones.
• Investigation and Outcome: The speaker investigated the company through the Ministry of Corporate Affairs (MCA) database and found no record of "International Financial Services" being a registered private limited company. It's estimated that this entity collected 12,000 crore rupees and absconded, with the perpetrators being absconders for the past four to five years.

4. Reasons for the Ease of Cheating in India

The speaker discusses why it's seemingly easy for large-scale scams to occur in India.

• Vast Population and Small Savings: India's large population means many people have small amounts of money, and a desire to get rich quickly.
• Stimulating Greed: The core strategy of scammers is to "stimulate their greediness," making people fall for promises of quick wealth. Cheating 3.5 lakh people out of 60,000 rupees each can yield 600 crore rupees.

5. Addressing Allegations of Tax Evasion and "Running Away" to Dubai

The speaker directly addresses accusations of being "anti-Indian" and engaging in tax evasion by moving to Dubai.

• Definition of Tax Evasion: He clarifies that tax evasion is failing to pay taxes when liable. He argues that as a Singapore citizen, he has the right to reside anywhere, and if he resides in Dubai, he is not liable to pay Indian tax on his personal income earned there.
• Distinction Between Personal and Corporate Income: He emphasizes that while his personal income might not be taxed in India, his companies operating in India still pay corporate taxes on their profits. He uses the analogy of Coca-Cola and Pepsi, whose owners are in America but pay taxes in India on their Indian operations.
• Reduced Tax Liability: He admits to paying less tax now because his personal income is no longer taxed in India, whereas previously both personal and corporate income were taxed.

6. The Tax Advantage of Dubai Residency for High Net Worth Individuals (HNIs)

The core of the speaker's explanation for moving to Dubai lies in the significant tax advantages, particularly for HNIs.

• Scenario: Indian Tax Resident vs. Dubai Tax Resident (10 Lakh Rupees FD)

  • Indian Resident: 10 lakh rupees in FD at 8% return. After 30% tax + surcharge (approx. 4.5%), only 5% net return. After 30 years, the amount grows to 43 lakh rupees.
  • Dubai Resident (Hypothetical NRI/Foreigner): 10 lakh rupees in FD in India at 8% return. No tax on interest. After 30 years, the amount grows to 1 crore rupees.
  • Difference: The 57 lakh rupee difference is attributed to taxes paid by the Indian resident.

• Scenario: Trading with 10 Lakh Rupees (20% Annual Return)

  • Indian Tax Resident: 10 lakh rupees invested, achieving a 20% annual return (e.g., 12% trading profit + 8% FD interest). After 35% tax on the total profit (approx. 7% of the 20%), a net return of 13% is achieved. Over 30 years, this grows to 3.9 crore rupees.
  • Foreign Investor (FIA) in India (Dubai Tax Resident): Registers as an FIA in India. No tax on futures and options (F&O) profits. Pays only a 5% tax on returns from Government Securities (GC) used as collateral. Effectively, the entire 20% return is realized. Over 30 years, this grows to 237 crore rupees.
  • Difference: A staggering 233 crore rupee difference, attributed to taxes.

• Comparison of Tax Rates:

  • India: Maximum income tax rate of 42%.
  • Singapore: Maximum income tax rate of 22%.
  • Dubai: No personal income tax.

• Indirect Taxes and Other Costs:

  • Car Purchase: A Rolls-Royce Phantom costs 14 crore in India vs. 7 crore in Dubai (7 crore savings).
  • GST/VAT: India can have up to 50% indirect tax, Dubai has 5% VAT, Singapore has 9% VAT.
  • Bribes: Singapore is free from bribes; India requires bribes at various stages.
  • Donations: Singapore's education system is free from donations; India has significant donation demands for school admissions.
  • Education Costs: Singapore school fees are as low as $5/month (approx. 300 rupees), with high quality. Indian schools often have poor infrastructure and high donation demands.

7. The "100 Cr Club" and Capital Growth

The speaker mentions being part of the "100 Cr club" and illustrates the impact of capital size on wealth accumulation.

• Example: 10 Cr Capital
  • Indian Resident: Over 30 years, with 20% annual return and taxes, accumulates approximately 500 crore rupees.
  • Foreign Investor (FIA): Over 30 years, with 20% annual return and minimal taxes, accumulates approximately 2,500 crore rupees.
  • Difference: A 2,000 crore rupee difference, highlighting the significant impact of tax policies.

8. Conclusion and Call for Change

The speaker concludes that significant changes are needed in India's tax policies and overall system. He notes that many ultra-HNIs are leaving India for these reasons. He hopes for future improvements in India but acknowledges that currently, it makes financial sense for such individuals to relocate.

Key Concepts:

• Unreasonable Returns: Promises of exceptionally high and guaranteed profits in trading.
• Tax Evasion: Illegally avoiding tax obligations.
• Tax Residency: The country where an individual is considered liable for taxes based on their residence.
• Foreign Investor (FIA): A foreign national registered to trade in Indian markets, often with tax benefits.
• Fixed Deposit (FD): A type of savings account with a fixed interest rate for a specified term.
• Collateral: An asset pledged as security for a loan or to guarantee the performance of an obligation (e.g., using FD as collateral for options trading).
• Futures and Options (F&O): Derivative financial instruments.
• Government Securities (GC): Debt instruments issued by the government.
• Ultra High Net Worth Individuals (UHNWIs): Individuals with substantial financial assets.
• Ministry of Corporate Affairs (MCA): Government body responsible for company registration and regulation in India.
• VAT (Value Added Tax): A consumption tax.
• GST (Goods and Services Tax): India's indirect tax system.