Black money: CBDT says people want big banknotes spiked

NEW DELHI: The Central Board of Direct Taxes said in its report on black money that it had received overwhelming public opinion in favour of demonetizing Rs 1,000 and Rs 500 notes, which could be an effective tool to curb generation of black money, something that yoga guru Baba Ramdev has been advocating.

However, the report said the finance ministry was not in favour of this measure as it involved huge economic cost. Currently, 79% of the total currency notes in circulation comprise Rs 500 and Rs 1,000 denomination notes.

“The director general of currency in the finance ministry had... raised the issue of huge economic cost of demonetizing higher denomination bank notes of Rs 500 and Rs 1,000 and stated that it was not a feasible idea,” the report said.

The finance ministry had invited opinion from all stakeholders on measures to curb black money generation . Among other suggestions received by the ministry, people favoured using credit, debit cards and electronic transactions besides minimizing paper currency.

They also favoured integrating all land and property registrations, property tax payments, income tax records and banking transactions to minimize avoidance of tax. Public opinion favoured one-time amnesty to bring back black money without any penalty and then implementation of harsh laws to fight graft.