Demonetisation struck on the roots of parallel black economy: President Kovind

The Indian President believed that the demonetisation was a defining moment in the NDA government's war on corruption.

Published: 31st January 2019 02:40 PM  |   Last Updated: 31st January 2019 02:40 PM   |  A+A-

Ram Nath Kovind

President Ram Nath Kovind (Photo | PIB)


NEW DELHI: Describing demonetisation as a defining moment in the NDA government's war on corruption, President Ram Nath Kovind on Thursday said it had struck at the very root of the parallel economy which was thriving on black money.

Addressing the joint sitting of Parliament, Kovind listed several measures taken by the government, like the enactment of new laws, the constitution of Special Investigation Team (SIT) and signing of tax information exchange agreements with various tax havens, to effectively deal with the menace of black money. "Demonetisation was a defining moment in the government's war on corruption and black money. This decision struck at the very root of the parallel economy thriving on black money, and the money outside the formal system was brought within the ambit of the nation's economy," he said.

The government had demonetised currency notes of 500 and 1000 denomination on November 8, 2016, to check black money. Post note ban, Rs 15.31 lakh crore worth demonetised notes were deposited in banks within a stipulated time. This was 99.3 per cent of the Rs 15.41 lakh crore worth Rs 500 and Rs 1,000 notes in circulation on November 8, 2016.

The President said assets worth more than Rs 50,000 crore are being confiscated under the Benami Property Act, Prevention of Money Laundering Act and the law against fugitive economic offenders. "As a result of the policies of my government, black money in real estate sector has declined substantially, the prices of houses have come down and the dream of a normal middle-class family for possessing their own house is being realised," he said.

He said on account of these policies, people's trust in the government has increased, and there has been a sharp rise in the number of persons paying income tax. "Whereas prior to 2014, 3.8 crore people had filed their returns, this number has increased and more than 6.8 crore people have come forward to file returns. Today, the taxpayer is confident that each paisa contributed by him or her is being spent honestly on nation-building," Kovind said.

Stating that demonetisation "broke the back of the forces destabilising the country and the systems sustaining the flow of black money," Kovind said the registration of 3.38 lakh dubious shell companies has been annulled.

The directors of these companies have also been prohibited from holding such offices again. "While giving a clear majority to my government in 2014, the people of the country had also given a clear mandate to take strict action against corruption and black money. My government has come down heavily on corruption in the past four-and-a-half years," the President said.

Stating that corruption and black money constitute a grave injustice towards the honest taxpayer of the country, Kovind said corruption always infringes on the rights of some poor or middle-class person. "The government is relying on the application of modern technology to address this situation".

The President further said Goods and Services Tax (GST) has helped in establishing an honest and transparent system of trade and commerce which is also benefitting the country's youth. "This system, while reducing the difficulties faced by traders, has enhanced their ease of doing business across the country. My government is continuously improving the GST regime keeping in view the suggestions being received from the business community," he said.

He further said while Sardar Patel had accomplished the challenging objective of geographic and political integration of India, the task of economic integration remained incomplete. "Now with the implementation of comprehensive tax reform like GST, the concept of ‘One Nation-One Tax-One Market' has been realised," Kovind said.

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