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Friday, July 15, 2016

SIT report on black money should be implemented with even more steps to curb black money


MADHU AGRAWAL
(Guinness Record Holder for letters in Newspapers)

It refers to quite a ‘liberal’ report presented by Special Investigation Team (SIT) set up by Supreme Court for suggesting ways to curb black money. Limit suggested by SIT for cash-transactions of rupees three lakhs is quite low and should not be more than rupees fifty thousand, now with a wide network of banks throughout the country where even poor-most can open bank-account with zero-balance. Likewise maximum cash-holdings can be further reduced to rupees five or ten lakhs rather than rupees fifteen lakhs as suggested. Permission can be obtained and given liberally for having more cash-holdings in actual need.

Useless and misused tax-exemptions like including 80G, 80GGB and 80GGC relating to donations for social cause and contributions received-by/made-to political parties should be abolished. Agricultural income should be taxed where super-rich rather than ordinary farmers take benefit to evade taxes. Import and sale of gold should only be through banks because gold-traders issue multiple numbers of cash-receipts even for bulk sale made to those parking black money in gold.

Tax-laws should be simplified by providing a permanent voluntary-declaration scheme to declare as much income as possible from ‘undisclosed sources’ on payment of maximum tax-slab of 30-percent. This will catch hold of those purchasing property from unaccounted cash when tax-persons will find ‘income from undisclosed sources’ in tax-returns of those selling the property. Capital-gain and stamp-duty should be reduced to 10 and 2 percent respectively to make people voluntarily declare true value of transacted property which in turn will give much-much more revenue than at present.

Sweden should be the role-model for India to become totally cashless country, where presently India is far behind 86-percent deals through cash. Aim should be to ultimately stop printing notes of higher denominations of rupees 500 and 1000. Not only all government-payments, but even salaries and other expenses by private parties above say rupees 5000 should also be compulsorily made through electronic bank-transfers only. System of electronic bank-transfers should also be encouraged and popularised so that small-salaried persons may not have to wait for three days to get cash. Such a system will effectively check corrupt practices as well apart from tax-authorities having an automatic tracking of suspicious bank-transactions if bank-accounts are compulsorily linked to Aadhar-number and Income Tax PAN card.

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