On Demonetisation 2nd Anniversary, FM Arun Jaitley defends note-ban says, 'government targeted black money outside India'
On the second anniversary of Demonetisation Finance Minister Arun Jaitley defended the BJP-lead PM Narendra Modi's move to ban major Indian currency on 8 November 2016 as opposition parties targeted the government and even demanded an apology from Prime Minister Narendra Modi.
In a Facebook post, Jaitley described PM Modi's overnight note ban on major currency notes on November 8, 2016, as a "key step in a chain of important decisions taken by the government to formalise the economy".
“Demonetisation is a key step in a chain of important decisions taken by govt to formalise the economy. Govt first targeted the black money outside India. Asset holders were asked to bring this money back on payment of penal tax,” said Arun Jaitley.
Demonetisation is a key step in a chain of important decisions taken by govt to formalise the economy. Govt first targeted the black money outside India. Asset holders were asked to bring this money back on payment of penal tax: FM on two years of #Demonetisation (file pic) (1/2) pic.twitter.com/boYhcLPxRy— ANI (@ANI) November 8, 2018
"An ill-informed criticism of the demonetisation is that almost the entire cash money got deposited in the banks. Confiscation of currency was not an objective of demonetisation. Getting it into the formal economy and making the holders pay tax was the broader objective," Mr Jaitley wrote in a Facebook post.
"The system required to be shaken in order to make India move from cash to digital transactions. This would obviously have an impact on higher tax revenue and a higher tax base."
The Finance Minister added, “Those who failed to do so are being prosecuted under the Black Money Act. Details of all accounts and assets abroad which have reached the Government resulted in action against the violators.”
“Demonetisation compelled holders of cash to deposit the same in the banks. The enormity of cash deposited&identified with the owner resulted in suspected 17.42 lakh account holders from whom the response has been received online through non-invasive method.”
“Personal income tax collections were higher in FY 2018-19 (till 31-10-2018) compared to the previous year by 20.2%. Corporate tax collections are 19.5% higher. From 2 years prior to demonetisation, direct tax collections increased 6.6% & 9% respectively,” said Arun Jaitely.