The large sums of cash infused into the banking system is among the many advantages of the demonetisation decision, Finance Minister Arun Jaitley said on Tuesday. “Significant amounts will be injected in the next three weeks,” he said, adding that this will help the facilities support the economy with low-cost lending, ANI reported.
Taxes will also be recovered wherever they are due, he said. “Once transactions are substantially digital, they get caught in the tax net. Therefore, the future taxation level will be much higher than what is currently being collected,” Jaitley said, according to PTI.
The finance minister believes that the government will be able to levy taxes more reasonably after the demonetisation move, which will be followed by a digital economy in India. “With all these advantages, the social cost on the system will go down. The cash used for bribery, for counterfeit currency, for terrorism, for evading taxes itself will go down,” he explained.
Jaitley, once again, reiterated that money will be available in ATMs as and when more of the new Rs 2,000 and Rs 500 notes come into circulation and are re-circulated in the banking system. “There are obvious advantages of this [demonetisation], not withstanding some transient problems people have to face,” he said.
He also urged the Opposition to “rise above slogans and look at the positive” side of demonetisation. The minister, like other leaders of his Bharatiya Janata Party, said the government was ready to hold a debate on the currency ban in Parliament. “From the national perspective, I appeal to the Opposition to join this campaign, rather than create obstructions and fail to understand what the real purpose of this campaign is,” he said.
So far, the Winter Session of Parliament has been a complete washout. Proceedings in both Houses have been disrupted repeatedly by Opposition parties protesting against demonetisation.
Since the announcement of the note ban on November 8, the Narendra Modi government has been trying to promote the idea of a cashless economy by encouraging everyone to opt for making digital payments. However, Opposition parties, including the Congress, have heavily criticised the discontinuation of the high-value notes.
In an opinion piece for The Hindu, Manmohan Singh said Modi had “shattered the faith and confidence of hundreds of millions of Indians”. During his address in the Rajya Sabha on November 24, Singh had described the move to demonetise Rs 500 and Rs 1,000 notes as a form of “organised loot” and said it would reduce the country’s GDP by 2% or more.