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People indulging in Money Laundering Activities and Converting their Black money into White will not be Spared, says Shaktikanta Das

Black money hoarders converting their unaccounted money into white using the poor people

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Indian Currency, Pixabay
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New Delhi, December 2, 2016: The Finance Ministry on Friday warned the black money hoarders that those involved in the conversion of black money to White will not be spared.

The government on November 8 had announced the demonetization of Rs. 500 and Rs. 1000 currency notes to root out corruption and terrorism from the country. But, black money hoarders were converting their unaccounted money into white by using the poor people.

Prime Minister Narendra Modi warned people that they should not convert their ill-gotten by using the poor people as it would put them into trouble.

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Modi said in his radio talk “Mann ki Baat”, “Some people think they can convert their black money into white. And they are looking at unlawful ways. It’s unfortunate they have chosen to use poor people for this.”

“I want to say that is us up to them to abide by the law or break it, it is up to them if they want to correct themselves. The law will deal with them. But please don’t play with lives of poor,” Prime Minister Modi added.

The government urged the citizens of India to help out the government in rooting out black money.

“Those indulging in or colluding with money laundering or converting black money into white will not be spared,” Economic Affairs Secretary Shaktikanta Das tweeted.

“Trails being pursued by agencies. Coordinated action underway. Result already visible. Will be more visible in coming days,” he added.

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According to the Taxation Laws (Second Amendment) 2016, those caught illegally converting money will have to cough up 60 percent tax plus penalties, which will come to 85 percent. The Lok Sabha on Tuesday passed this Bill that seeks to tax money deposited in bank accounts post demonetisation.

Finance Minister Arun Jaitley said that the bill was brought after it came to know that people were exchanging the demonetised Rs. 500 and Rs. 1000 currency notes illegally, mentioned PTI.

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The government even requested people to provide information of such illegal activities to the IT department so that strict action could be taken against them and help in curbing out black money from the country.

The Ministry said in a statement, “Income Tax and penalty would be subjected if it is found that the amount deposited in the account was not of the account holder but of somebody else. Also, the person can be prosecuted for abetment under the Income Tax Act.”

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“Black money is a crime against humanity. We urge every conscientious citizen to help join the government in eradicating it,” it added.

The tax department has enclosed that cash deposits of more than 2.5 lakh in bank accounts would have to provide PAN card.

prepared by Zoya Arshi from NewsGram Twitter: zoyaarshi96

 

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The Answer to The Impending Questions On Demonetization Are Here

While it did broaden the country’s tax base, it was a nightmare for the immense, cash-dependent informal economy.

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Indian Currency. Pixabay

Nearly all of the currency removed from circulation in a surprise 2016 attempt to root out illegal hoards of cash came back into the financial system, Resever Bank of India  has announced, indicating the move did little to slow the underground economy.

Prime Minister of India, Narendra Modi’s currency decree, which was designed to destroy the value of billions of dollars in untaxed cash stockpiles, caused an economic slowdown and months of financial chaos for tens of millions of people or demonetization.

Modi announced in a November 2016 TV address that all 500-rupee and 1,000-rupee notes, then worth about $7.50 and $15, would be withdrawn immediately from circulation. The banned notes could be deposited into bank accounts but the government also said it would investigate deposits over 250,000 rupees, or about $3,700. The government eventually released new currency notes worth 500 and 2,000 rupees.

 

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An activist of Congress party hold the banned 500 and 1000 rupee notes.

 

In theory, the decree meant corrupt politicians and businesspeople would suddenly find themselves sitting on billions of dollars in worthless currency, known here as “black money.”

“A few people are spreading corruption for their own benefit,” Modi said in the surprise nighttime speech announcement of the order. “There is a time when you realize that you have to bring some change in society, and this is our time.”

But even as the decree caused turmoil for those in India who have always depended on cash — the poor and middle class, and millions of small traders — the rich found ways around the currency switch. In the months after the decree, businesspeople said that even large amounts of banned currency notes could be traded on the black market, though middlemen charged heavy fees.

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Prime Minister Narendra Modi along with mayor, flickr

The reserve bank of India report said in its Wednesday report that 99.3 percent of the $217 billion in notes withdrawn from circulation had come back into the economy. Some officials had originally predicted that number could be as low as 60 percent.

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“Frankly, I think demonetization was a mistake,” said Gurcharan Das, a writer and the former head of Proctor & Gamble in India. He said that while it did broaden the country’s tax base, it was a nightmare for the immense, cash-dependent informal economy.

“You can’t overnight change that in a country which is poor and illiterate. Therefore, for me it’s not only an economic failure but a moral failure as well,” Das said. (VOA)