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Demonetization expanded tax base,formalised economy, confiscation of currency was not objective: Jaitley

News Summed Up 2018-11-08 05:30:00

He further said with the implementation of the goods and services tax (GST), it is now becoming increasingly difficult to evade the tax system and the indirect tax to gross domestic product (GDP) ratio has gone up to 5.4 per cent post GST, from 4.4 per cent in 2014-15. Terming the criticism, that almost the entire cash money got deposited in the banks post demonetization, as ill-informed , Jaitley said confiscation of currency was not an objective of demonetization.Getting it into the formal economy and making the holders pay tax was the broader objective. The system required to be shaken in order to make India move from cash to digital transactions. This would obviously have an impacton higher tax revenue and a higher tax base, Jaitley said.The government had on November 8, 2016, announced ban on old 500 and 1000 rupee notes, to curb black money in the system. It became a part of the formal system, Jaitley added.He said the share of indigenously developed payment system of unified payments interface (UPI) and RuPay card have reached 65 per cent of the payments done through debit and credit cards.