Page 42 - 30NOV2018E

DEMONETISATION

Digitisation of 54.33 per cent compared to the of 97,000 crore given to the smaller
The Unified Payment Interface (UPI) previous year till this date. The new taxpayers and a 80,000 Crore relief
was launched in 2016 involving real- filers added this year are 86.35 lakh. given to the GST assesses tax collections
time payments between two sets of In May, 2014, when the present Gov- have gone up. Rates of taxes, both direct
mobile holders. Its transactions have ernment was elected the total number and indirect have been reduced, but tax
grown from 0.5 billion in October, of the filers of income tax returns was collections have gone up. The tax base
2016 to 598 billion in September, 2018. 3.8 crore. In the first four years of this has been expanded. GST rates on 334
The Bharat Interface for Money (BHIM) Government, it has increased to 6.86 commodities which were paying an
is an App developed by NPCI for quick crore. By the time the first five years of effective 31 per cent tax pre-GST have
payment transactions using UPI. It is this Government are over, we will be witnessed a tax reduction.
currently used by 1.25 Crore people. close to doubling the assessee base. The government has used these
The value of BHIM transactions has resources for better infrastructure
gone up from 0.02 billion in Septem- Impact on indirect taxes creation, social sector, and Rural India.
ber, 2016 to 70.6 billion in September, Demonetisation and implementation How else could we visualise villages
2018. The share of BHIM transactions of the GST curbed cash transactions in being connected by Road, electricity
in overall UPI transactions is at about a big way. An increase in digital transac- in every home, 92 per cent coverage
48 per cent in June, 2017. tions is visible. This formalisation of the for rural sanitation, a successful Awas
The RUPAY Card is used both at economy has led to the tax payer base Yojana, a cooking gas connection
the Point of Sale (PoS) and for e-com- increase from 6.4 million in the pre-GST in 8 crore poor homes. Ten crore
Truth behind from 8 billion before Demonetisation post-GST regime. The actual consump- man Bharat, 1,62,000 crore is being
merce. Its transactions have increased
families are covered under Ayush -
regime to 12 million taxpayers in the
spent on subsidised food, 50 per cent
to 57.3 billion in September, 2018 for
increase in MSP for farmers and a
PoS and from 3 billion to 27 billion
demonetisation in e-commerce. Today Visa and Mas- Now assessees have successful Crop Insurance Scheme. It
tercard are losing market share in
is the formalisation of the economy
to declare their
India to indigenously developed a pay-
which has led to 13 crore entrepreneurs
business turnover.
ment system of UPI and RUPAY Card
getting Mudra Loans.
whose share have reached 65 per cent
of the payments done through debit It not only impacts The criticism
which have reached the Government, banks. The enormity of cash deposited and credit cards. the indirect tax However, Congress President Rahul
TEHELKA BUREAU resulted in action against the viola- and identified with the owner resulted Gandhi felt that “with that one decla-
tors. Technology has been used for both in suspected 17.42 lakh account hold- Buoyancy in direct taxes calculations but also ration of demonetisation, 86 per cent
Direct and indirect taxes to facilitate ers from whom the response has been The impact of Demonetisation has ensures that income of India’s currency was taken out of
hile the full truth about the filing of returns and expanding the received online through non-invasive been felt on a collection of person- circulation, bringing our economy to a
demonetisation is not tax base. method. The violators faced puni - al income tax. Its collections were tax arising out of grinding halt. He added that demoneti-
yet out, a war of words Financial inclusion was another tive actions. Larger deposits in banks higher in Financial Year 2018-19 (till them is disclosed sation was a tragedy, which was a self-
has ensued as it com- important step to ensure that even improved lending capacity for the 31-10-2018) compared to the previ- inflicted, suicidal attack that destroyed
W pletes two years. While weaker sections became part of the for- banks. A lot of this money was diverted ous year by 20.2 per cent. Even in millions of lives and ruined thousands
finance minister, Arun Jaitley wrote in mal economy. Jan Dhan Accounts have to the Mutual Funds for further invest- the corporate tax the collections tion of goods and services is recorded as of India’s small businesses. The worst
his blog resulted in most people being con - ments. It became a part of the formal are 19.5 per cent higher. From two a part of the tax net has now increased. hit by demonetisation were the poor-
That “Demonetisation is a key step in nected to the banking system. The Aad- system. years prior to Demonetisation, This has given a buoyancy to the indi- est of the poor, forced to queue for days
a chain of important decisions taken by haar Law has ensured that Direct Ben- direct tax collections have increased rect tax growth in the economy. This to exchange their meager savings. A
the Government to formalise the econ- efit Transfer of Government support Ill-informed argument? by 6.6 per cent and 9 per cent respec- has benefited both the Centre and the large number of small and medium
omy”, the Congress party held country- system reached directly into the bank An ill-informed criticism of the demon- tively. In the next two years, post De- States. Every State, post-GST, is getting businesses was smashed and the
wide protests on the second anniver- accounts. The GST has further ensured etisation is that almost the entire cash monetisation the increase by 14.6 per a mandatory 14 per cent increase in the entire informal sector devastated. And
sary of demonetization. The purpose that in the matter of Indirect taxes, the money got deposited in the banks. Con- cent (part of the year before the impact taxation each year. The fact that asses- the list of these supposed objectives
appears to win brownie points. tax procedures become simple. It is fiscation of currency was not an objec- of Demonetisation in 2016-17) and an sees have to now declare their business has grown over time. From a war
The finance minister observed that now becoming increasingly difficult to tive of Demonetisation. Getting it into increase of 18 per cent in the year turnover not only impacts the indirect against counterfeit currency and ter-
the Government first targeted the evade the tax system. the formal economy and making the 2017-18. tax calculations but also ensures that rorism, to permanently removing the
black money outside India. Asset hold- India was a cash-dominated econo- holders pay tax was the broader objec- Similarly, in the year 2017-18, the income tax arising out of them is dis- scourge of black money; from increas-
ers were asked to bring this money my. Cash involves anonymity in trans- tive. The system required to be shaken tax returns filed reached 6.86 crore, closed in the tax assessments. In 2014-15, ing savings to forcing a shift to digital
back on payment of penal tax. Those actions. It bypasses the banking system in order to make India move from cash an increase of 25 per cent over the the indirect tax to GDP ratio was 4.4 per transactions; not a single stated objec-
who failed to do so are being pros - and enables its possessors to evade to digital transactions. This would obvi- previous year. This year, as on 31- cent. Post-GST it has climbed up by at tive of the Government’s has been met”.
ecuted under the Black Money Act. tax. Demonetisation compelled hold- ously have an impact on higher tax rev- 10-2018, already 5.99 crore returns least 1 percentage point to 5.4 per cent.
Details of all accounts and assets abroad, ers of cash to deposit the same in the enue and a higher tax base. have been filed which is an increase Despite an annual income tax relief LETTERS@TEHELKA.COM

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