Black day vs anti-black money day: BJP, Opposition face off over note ban

Manmohan Singh said if anyone benefited demonetisation, GST, it was China whose imports to India grew by 23% in just 1 year

Demonetisation, currency, notes

A year into demonetisation – Anti-Black Money Day, the opposition and the government on Tuesday exchanged verbal blows over the action with former Prime Minister Manmohan Singh calling it disastrous while Finance Minister Arun Jaitley rejected the charge saying there was an ethical and moral rationale behind the decision which had given a “new direction” to the economy.

Jaitley, however, acknowledged that the “benefits may not be immediately visible” but would make future generations proud.

Fielded by the party in poll-bound Gujarat, Manmohan Singh said the measure had failed its ostensible purpose of curbing wealth accumulated through tax evasion as it was known by now that none of the stated objectives of eliminating black money, terror financing and counterfeit currency have been met.

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“The fact that more more than 99 per cent of the (spiked) currency came back into the banking system has punctured the government’s claim. There are also widespread reports of the rich converting their black money into white while the poor have undergone immense suffering,” he said, “invoking the memory of more than a hundred people who lost their lives last year in the wake of the demonetisation”.

Calling the withdrawing of 86 per cent of legal tender in one single stroke as undemocratic and a coercive move, the former Prime Minister said “the demonetisation was clearly not the solution” to end the menace of black money and tax evasion in India.

“Demonetisation has proved to be a mere bluster to reap political dividends while the real offenders have escaped,” he said, again calling it “an organised loot and legalised plunder”. | READ MORE

Black money chase: Hawala, real estate, election funds Modi’s next targets?

Here are details of yet-to-be-public 1000-page report on which the govt may have based its crackdown

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Even as the government has launched a high-profile drive against black money, a 1,000-page study on unaccounted incomes in India has not been made public for a year now. Produced by the think-tank National Institute of Public Finance and Policy (NIPFP) at the instance of the UPA government of 2012, the report was submitted to the present government in 2016.

A detailed study on unaccounted incomes in India has outlined a multi-pronged strategy that the government should adopt to curb generation of black money by professionals, educational institutions, capital market intermediaries and real estate players.

In addition, the voluminous report running into over a thousand pages makes concrete suggestions to plug legal loopholes to prevent generation of black money through election funding, money laundering and clandestine transfer of wealth abroad. Equally significant, the report lays down a road map for beefing up the income-tax department to tackle the menace of black money.

The report has been produced by the National Institute of Public Finance and Policy (NIPFP) at the instance of the government, which had issued an order in 2012 entrusting the fiscal policy think tank with this task. The report, which has been reviewed by Business Standard, was submitted to the government only a year ago, but its findings are yet to be made public, even as the present government under Prime Minister Narendra Modi has launched a high-profile drive against black money.

It is also significant to note that some of the recommendations made by the NIPFP report seem to have already been implemented by the government in the last year or so, though after some modifications. What the fate of the other recommendations to eliminate black money is likely to be, however, is not clear as of now. Therefore, a quick look at some of the salient recommendations made by this report could provide a clue to the likely course and direction of government action against black money in the coming few months. | READMORE…

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