ASSOCHAM: Demonetization can do little to stop future black money flow
Posted on: 20/Jan/2017 10:23:23 AM
After the demonetization, the black money kept in cash form may disappear. However, the black money invested in the form of gold or Real Estate cannot be removed from the economy. Further, ASSOCHAM observed that this demonetization will help to a little extent in bringing down the circulation of black money.
It has further observed that though demonetization may help to a little extent in bringing down the circulation of black money, some more reforms must be taken up and carried out to remove black money from the economy.
The registration Fee for the properties must be brought down. Also, all property transactions and registration must be carried out in electronic format. This would considerably help to reduce the circulation of black money. In a similar vein, the difference between the market rates and the actual selling rates must be brought down.
The Income Tax Department has not been that successful in bringing out all the Foreign Exchange Frauds in several bank accounts. In the existing set-up, it is rather a great challenge to uncover all the foreign exchange frauds.
Also, it is rather difficult to identify the white and black money in the market. Just consider a typical example: if a person buys an item from a shop by paying white money, it would become black money in case the shop owner fails to pay the Sales Tax for this transaction.
If black money is to be completely removed, the authority given to the officials must be reduced. However, most of constitutional Acts are designed for the convenience of the power in the hands of the authority.
ASSOCHAM has strongly recommended that the present central government with a strong majority and political clout should take the immediately required measures in this regard.
