PM Modi’s Cash Ban Could Boost Budget By $45 Billion: Foreign Media

[Kyusuibu Honbu]

Ok... So...

The 500 & 1000 notes will be taken out of the system completely. Replaced by new 500 &2,000.

The $45B added to the government's budget will come from the banks flagging exchanges of the 500 & 1000 notes once they equal more than 250,000. Requiring the exchanger to produce validation of income, which if he doesn't results in a 200% fine on top of the tax amount to be collected?

Looks like Modi took a page out of America's (and many other nations) anti-tax evasion policies.

USA had implemented this? any link

 

[Nilgiri]

Ok... So...

The 500 & 1000 notes will be taken out of the system completely. Replaced by new 500 &2,000.

The $45B added to the government's budget will come from the banks flagging exchanges of the 500 & 1000 notes once they equal more than 250,000. Requiring the exchanger to produce validation of income, which if he doesn't results in a 200% fine on top of the tax amount to be collected?

Looks like Modi took a page out of America's (and many other nations) anti-tax evasion policies.

Basically in a nutshell yeah.

Worth reading for a deeper analysis:

http://www.thefrustratedindian.com/2016/11/india-black-money-cash-tax/

USA had implemented this? any link

https://en.wikipedia.org/wiki/Large_denominations_of_United_States_currency

http://time.com/money/4226174/kill-100-dollar-bill-500-euro-phase-out/

 

[Mitro]

He will be disappointed when he will see all the money deposited before 31 dec he won't be making any profit he will only make new enemies that's also common Indian people .

 

[SrNair]

Ok... So...

The 500 & 1000 notes will be taken out of the system completely. Replaced by new 500 &2,000.

The $45B added to the government's budget will come from the banks flagging exchanges of the 500 & 1000 notes once they equal more than 250,000. Requiring the exchanger to produce validation of income, which if he doesn't results in a 200% fine on top of the tax amount to be collected?

Looks like Modi took a page out of America's (and many other nations) anti-tax evasion policies.

This wont completely eradicated the black money ,but it gives a huge blow to the shadow economy .A good move indeed.
The perfect victim is FICN.
At any way counterfiet notes and rackets are finished once and for all.

He will be disappointed when he will see all the money deposited before 31 dec he won't be making any profit he will only make new enemies that's also common Indian people .

Nice post

In India even his heavy criticisers congratulating him because of this decision .

There are two types of peoples that oppose or criticisethis move .
1.Corrupt or persons having large amount of black economy
2. Fools that cant even understand the situation and dumbs that dont know economics

 

[TimePass]

It still is a legal tender, until Dec. 30, as long as whoever takes the money can deposit to bank.

You are misinformed.

The old currency ceased to be a legal tender from the midnight of 8th November.

So NO legal transaction can be done using the old currency including the buying of gold. They old note can ONLY be exechanged in the banks for new one's or deposited in the banks as electronic currency.


Now if a Jeweller will accept old currency AFTER 8th November, he cannot declare that as legitimate income. Which means he also cannot deposit it in the bank since he cannot declare that income.

No sensible seller of gold will do this when there is already a huge booming market for legal buyers of gold. Why take the unnecessary risk for short term gain and long term loss ? Its just not wroth it.

 

[Mitro]

Corrupt people knows how to play around the system and survive so I don't worry about them I am concern for rural people and women how hide their money from their family for bad time or for their daughters or son wedding .
We have so many village where people don't have bank for 25 kilometers and this poor people have to let their daily wages go just to stand in bank queues.
Only poor people are in line have u seen any corrupt people no because they are expert in manipulating the system.
Personally seen people with millions of rupees relax and don't worry for any thing

 

[Bheemsen]

Basically in a nutshell yeah.

Worth reading for a deeper analysis:

http://www.thefrustratedindian.com/2016/11/india-black-money-cash-tax/



https://en.wikipedia.org/wiki/Large_denominations_of_United_States_currency

http://time.com/money/4226174/kill-100-dollar-bill-500-euro-phase-out/

Going buy your US reference logic how this move is similar , removing old 500,1000 notes and replacing by 2000 and 500 and later 1000 too coming

 

[Nilgiri]

Going buy your US reference logic how this move is similar , removing old 500,1000 notes and replacing by 2000 and 500 and later 1000 too coming

and it will also be a move I suspect will happen with some frequency (say once every decade or something). This one will be the major one that most will be learned from logistically.

 

[Storm Force]

Modi is a brave man.

He is alo a DOER not just just a TALKER

£45 BILLION ADDED TO indian coffers in a matter of a few days is A SMART MOVE

 

[Nilgiri]

Modi is a brave man.

He is alo a DOER not just just a TALKER

£45 BILLION ADDED TO indian coffers in a matter of a few days is A SMART MOVE

Long term, about 500 billion USD or even more may be added to Indian nominal GDP.

 

[Storm Force]

Long term, about 500 billion USD or even more may be added to Indian nominal GDP.

That's huge

 

[Sam.]

That's huge

So is uncharted money in houses.

 

[Skull and Bones]

Corrupt people knows how to play around the system and survive so I don't worry about them I am concern for rural people and women how hide their money from their family for bad time or for their daughters or son wedding .
We have so many village where people don't have bank for 25 kilometers and this poor people have to let their daily wages go just to stand in bank queues.
Only poor people are in line have u seen any corrupt people no because they are expert in manipulating the system.
Personally seen people with millions of rupees relax and don't worry for any thing

They have post offices to convert their money.

 

[enquencher]

Gold can not be sold without Tax Account No. (PAN) so hard to buy with old note

Gold is brought in bulk...by hoarders..the jweller is making multiple bills with less than 200000 rs value ..which does not require pan card.
But people have to understand main motive of this exercise government does not want to jus catch the black money oweners it wants all money into the white system.whoecer takes gold or any other stuff finally thies 500 n 1000 notes have to come to bank by 30 dec or they will become useless.so finally all money will come to bank..whoever deposits it after all rounds of transections.

Govt is saying that below 2.5 lacs deposit no scrutiny will take place. Why ?
Initially they can concentrate on above 2.5 lacs but if they are smart , they should investigate all cases of deposits between 1 and 2.5 lacs.
Because many people have multiple accounts . And accounts in name of their wives and children.
So suppose 2 kids and wife suddenly deposit
2 .5 x 3 ie 7.5 lacs of cash , why let it go unscrutinised.

See my other post.
All money below 2.5 lack come into system.n all hoarders having crores dnt have easy way out.these people are going to go to rbi from 1st jan to 31st march time frame

I m expecting abt 100 billion dollar in collection now. This is all the deposits in accounts not jus black money.plus expect in increase in it tax coming year coz of increase deposits.

 

[Great Sachin]

Gold is brought in bulk...by hoarders..the jweller is making multiple bills with less than 200000 rs value ..which does not require pan card.
But people have to understand main motive of this exercise government does not want to jus catch the black money oweners it wants all money into the white system.whoecer takes gold or any other stuff finally thies 500 n 1000 notes have to come to bank by 30 dec or they will become useless.so finally all money will come to bank..whoever deposits it after all rounds of transections.


See my other post.
All money below 2.5 lack come into system.n all hoarders having crores dnt have easy way out.these people are going to go to rbi from 1st jan to 31st march time frame

I m expecting abt 100 billion dollar in collection now. This is all the deposits in accounts not jus black money.plus expect in increase in it tax coming year coz of increase deposits.

if they sell more gold then they have to buy more.....if any gold shop shows surge in selling..govt can check their stock transactions and catch them