Finance Minister Arun Jaitley on Thursday defended the decision to announce demonetisation which, he said, led to the formalisation of the economy and blow to the black money. In a Facebook blog, Arun Jaitley wrote, “The larger purpose of demonetisation was to move INDIA from a Tax Non-compliant society to a compliant society.”
On Wednesday, the Reserve Bank of India (RBI) report showed that 99.3% of demonetised notes came back to banks, which led to political slugfest over the purpose of demonetisation. Arun Jaitley said that the positive effects of demonetisation were more formalisation of the economy, more money in the system, higher tax revenue, higher expenditure, and higher growth after the first two quarters.
He said that when cash is deposited in the banks, the anonymity about the owner of the cash disappears and the government is conducting an enquiry into cases of such deposits. “In the last two years, when the impact of demonetisation and other steps is analysed, the Income Tax returns have increased by 19% and 25%. This is a phenomenal increase,” Arun Jaitley wrote.
Meanwhile, Rahul Gandhi launched a scathing attack on the government and said that demonetisation was not a mistake but a well-planned move to take money from farmers and give it to crony capitalists. He said that demonetisation helped in conversion of black money into white.
