NEW DELHI: Finance Minister Arun Jaitley defended the demonetisation of `500 and `1,000 notes on the eve of its first anniversary, stating that it could not be a “one-stop solution” to end corruption. The change in focus brought about in making economic and financial decisions, he said, should be the take-away.
“Demonetisation is not a one-stop solution to end corruption. It cannot be, but it did change the agenda. And that changed agenda is that we should go towards less-cash economy. Individual tax payers’ number has increased, digital transactions have gone up and terror funding has squeezed,” Jaitley said. Though a less-cash system would not end corruption, he pointed out that it would make it “more difficult”.
Earlier in the day, Jaitley enumerated the thinking behind the move and the benefits accrued in a blog post, calling it a watershed moment in Indian economic history. “It would not be wrong to say that country has moved on to a much cleaner, transparent and honest financial system,” he stated.
According to Jaitley, the move met its objective of reducing cash in the economy, ending anonymity of cash, bringing in more individuals in the tax net and dealing a “body blow to black money”.
Of the `15.44 lakh crore withdrawn from the circulation last year, `15.28 lakh crore had been deposited back as on June 30, 2017.
Arun Jaitley sticks to his guns
On the return of Rs 15.28 L cr of the demonetised Rs 15.44 L cr into the system, the FM said it means “almost the entire cash holding of the economy now has an address”
He claimed currency in circulation was Rs 3.89 L cr less, and undisclosed income admitted and detected was Rs 29,213 cr
2.24 L shell firms have been de-registered; I-T dept has taken action against over 1,150 firms used to launder over Rs 13,300 cr
Removal of anonymity increased the tax base, with 56 L new individuals filing returns this year until August 5