On the second anniversary of the demonetisation drive, Union Finance Minister Arun Jaitley on Thursday came forward to justify the drastic step taken by the Narendra Modi-led NDA government on November 8, 2016, to stabilise the economy. Defending the government action, Jaitley said demonetisation was a key step against black money violators and it facilitated the filing of tax returns. On the 2nd anniversary of demonetisation drive, Arun Jaitley penned a Facebook blog in which he said the economic decision was a key step in a chain of important decisions taken by the government to formalise the Indian economy.
However, Opposition Congress targetted the government on the second anniversary of the demonetisation drive. Terming the move as ‘economic misadventure’ the party said demonetisation was initiated to convert black money to white. The people of India won’t forget or forgive Prime Minister Narendra Modi because 120 people lost their lives and small and medium businesses crippled due to the ill-fated and ill-thought exercise of the NDA government. Former prime minister Manmohan Singh said note ban impacted every single person, regardless of age, gender, religion, occupation or creed and the scars and wounds of demonetisation are only getting more visible with time.
Jaitley asserted that the Modi government first targetted the black money outside India and asset holders were asked to bring this money back on payment of penal tax; those who failed to do so were persecuted under the black money act. Details of all accounts and assets abroad which have reached the government resulted in action against the violators, he added. Speaking on the criticism of demonetisation that almost the entire cash money got stashed in banks, Jaitley said confiscation of currency notes was not the sole aim of the demonetisation; getting it into the formal economy and making the holders pay tax was the broader objective. The system required to be shaken in order to make India move from cash to digital transactions and this resulted in higher tax revenue and a higher tax base, the minister added.
Speaking on the effect of demonetisation on digitisation, Jaitley said the digital transaction is witnessing huge growth after November 8, 2016, while Visa and Mastercard are losing market share in India to indigenously developed payment system of UPI and RUPAY Card whose share has reached 65% of the payments done through debit and credit cards. Apart from that, the impact of Demonetisation has been felt on the collection of personal income tax and its collections were higher in Financial Year 2018-19 (till 31-10-2018) compared to the previous year by 20.2%, the finance minister said.
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