By : M.S.Yatnatti: Editor and Video Journalist Bengaluru: Note ban or note exchange or demonetization will not solve black money creation in the country .Experts say remove income tax and black money gets eradicated. Modi Government can do wonders if it remove income tax and it will revolutionize Indian tax system .Reportedly Demonetization has removed old black money and Re-monetization has created new black money as cash transactions happens at a rapid phase and at multiple transactions happen and multiple phases and cash is moved from one person to another person's an transactions are not reported in tax returns and thus creation of black money will be a chain reaction whether it is digital transaction or cash transition and it is almost impossible to government to track tax evasion as transactions happens every day every day . Remove income tax and black money gets eradicated .Keep only sales tax or service tax. Taxing on both sides is not a good economy. According to reports "The cash assets on which taxes have not been paid is termed black money .Largely it exists in all taxed economies except no tax countries like UAE ".Economy does not recognize color of money but govt does. As long there are taxes, there is scope for black money. It is not possible for taxing countries to do away with black money. However, dilutions are easily possible. Black money and corruption have in every country. So, a model cannot eradicate these problems from the society. If the government become more conscious and people become honest then they can be reduced. Corruption is nothing new in any country and any society. Every human being is opportunistic in one way or other. If a student gets chance to copy for good marks he will do.Everybody wants quick benefits with less hard-work, that's why when opportunity arises nobody thinks about welfare of others. So the only way to contain it is severe laws and strict enforcement. but then the question arises what if the law-makers are corrupt. That's exactly what happens in poor and least developed countries the most. Corruption may also be existing in developed countries, but it won't be affecting the day-to-day life of millions of people. So that's why corruption is more a topic of behavioral economics. Corruption and black money can be modeled but i don't think some empirical or mathematical model can wipe out these problems from the country until or unless the people+politicians+bureaucrats are fully determined to do so. For me only one unique to eradicate the corruption in the world is firm belief in God and punishment one will get Hereafter for disobeying Our Lord. otherwise there is no model or theory which will guarantee that corruption will be eradicated.
Note ban or note exchange or demonetization anniversary on 8 November passed on 08-11-2017 but unfortunately debate is continued with the problem with the somewhat fuzzy thing called reform is that while it pays off in the long term, its short term benefits are less visible.wth significant costs..Economists and experts and the media routinely criticize governments for lacking farsightedness and opposition parties are quick to derive political gains. Decisions are routinely described and dismissed as `political' since they avoid short term costs and give the future short shrift. Thus it is somewhat ironic that the same critics have given demonetization, undoubtedly a `reform' in the textbook sense of the word, just 12 months to prove its mettle. Its first anniversary has failed to do any trick as Indians returned almost all of the estimated Rs 15.4 lakh crore ($242 billion) in high-currency bills removed from circulation in a shock move late last year, the Reserve Bank of India (RBI) said in its annual report out. A total of Rs. 15.28 lakh crore was returned to the central bank through lenders, a number that could renew scrutiny about the effectiveness of the measure announced by Prime Minister Narendra Modi in November. By rendering 500 and 1,000 rupees illegal in one stroke and imposing restrictions on how the money could be returned to lenders, Modi had been intending to make it difficult for hoarders of undeclared wealth, or black money, to exchange their undeclared cash for legal tender.
If you still have some banned 500-and 1,000-rupee banknotes left you might get one last chance to exchange them.The Supreme Court asked the Reserve Bank of India (RBI) on Tuesday to come up with a policy to offer a window to people who could not deposit their demonetised notes for legitimate reasons before last year's December 30 deadline."What if someone is terminally ill and could not deposit the money. If someone has a genuine reason, you cannot deny him the opportunity to deposit the money. You cannot be allowed to deprive a person of his money,” a bench headed by Chief Justice JS Khehar told solicitor general Ranjit Kumar."Don't force us to pass a three-line order and quash your notification,” it warned.The court is hearing petitions challenging the notification that disallowed people to deposit the scrapped money after December. The solicitor general took two weeks to file the government's response."You cannot take away someone's property. If it's my money and I can establish that, then you cannot deprive me of my property,” Khehar said.The government recalled 500- and 1,000-rupee notes last November, wiping out 86% of the money in circulation in a cash-driven economy.