Suggestions on demonetisation

Dear Arun Jaitley sahib

NDA government’s bold move is being appreciated by most people despite personal inconveniences. To avoid inconvenience to bulk of ordinary citizens, here are a few suggestions for your consideration.

  1. Wherever there is genuine trace-ability and audit trail as well as small transaction sizes, please allow use of old notes. This means co-operative and other such Tier 2 banks, Insurance companies, PSU payments, even purchase of cars, motorcycles with PAN/Aadhar etc. This list can be kept liberal as long as the major criteria is met – Audit trail. Specific transactions can always be investigated later at random or more.
  2. Why not allow real estate companies also to collect cash, as long as they bank it in and report it? After all, both giver and receiver is forced to bring it into the system and be liable for taxes, if any?
  3. Find innovative ways to pay something back to the ordinary citizens that queued up. A special dividend of even Rs.500 for each citizen that deposited/exchanged/withdrew a maximum of Rs.20,000 between 9th-20th November would go a long way to reach to the bottom layer. If the de-monetisation goes well, we expect almost $20b in “bonus” from RBI? Surely it can be put to good use?
  4. You may want to copy the Singapore government move to declare special tax refund for the next fiscal year, again for low income people. The problem with this in India is, the poorer sections don’t file income tax at all, hence don’t benefit. But we can think of other ways – say a GST Voucher or something.
  5. Build something visible, useful to poor people with the funds flowing from this exercise. Each village or a group of villages should have at least one structure (school, hospital, etc) built and explicitly identified as funded by recovered black money.
  6. Where is the famed RSS/BJP volunteer army? Please tell your party to ramp up their outreach.

We wish you good luck in your massive exercise to rid India of black money.