Finance Minister Arun Jaitley while talking about the benefits of demonetisation, hinted at lower rates of direct and indirect taxes in future since greater tax returns have been coming in due to demonetisation of high denomination notes.
He further said that the government has been monitoring the unlawful activities of the money launderers very carefully and warned them about a “very heavy price” that they might have to pay in coming future for their unscrupulous acts.
Arun Jaitley talks about benefits of demonetisation
“So much money…operating as loose cash in the system has today come into the banking system…It has to be accounted for. Where taxes have not been paid will now be recovered.”
“Once they are substantially digital they get caught in tax net…Therefore the future taxation level would be much higher than what is currently being collected. This would also enable the government at some stage to make taxes more reasonable which will apply to both direct and indirect taxes.”
Jaitley further said that demonetisation combined with other reforms especially the Goods and Services Bill and the restrictions on cash spendings will definitely bring down the mammoth corruption in the economy.
“It is going to bring down cash transaction in society and it’s going to bring down levels of evasion as far as taxation is concerned…Obviously, there is a breach of law in this and this is a step which hurts the economy. And therefore all agencies have an eye on this. They will investigate this matter and all those who are indulging in this malpractices will have to pay a very heavy price for what they are doing.”
