After all the excitement on demonetization exercise and being quite vocal about it, I am now veering towards supporting the opposite view- the stupidity of the decision.
A. Who created black money? Some of them are in Income tax department and are Govt employees. They will contnue to cheat in future as well.
B.Where is the Black money? Likely to be invested in real estate. So they loose over time (not immediately) when they intend to exit and cannot get the price they expected. If they do end up getting anything greater than their purchase cost the tax paid on gain will be insignificant compared to penalty on unaccounted money.
C. The unorganised sector in most of the sectors does cheat on taxes but then they also employed manpower. If they cheat who made it possible? Isn’t it the Government? For some of them it’s the only competitive advantage to be in business. For instance we have heard people building properties running a single kiraana shop in neighborhood but how many get to achieve the same today or for that matter in last decade.
D. It’s fooling the common man by first bringing scheme like IDS when most of the black was made white. Now the common man falls for the rhetoric of a great decision. The ones being troubled now are the tail of the Black money holders. It should have been a pecking order with biggest offenders penalised.
For the above reasons I prefer to name the #demonetization as a measure to kill the #unorganised sector. And to create a rhetoric to benefit political goals.