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Old 9th December 2016, 16:22   #1531
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by sukhoi30 View Post
1. Some people are under the impression that Govt. is forcing you to go cashless.
-- What action of Govt. suggests so?
The absence of cash suggests so.
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Old 9th December 2016, 16:26   #1532
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by nowwhat? View Post
It's actually December 30th.
Hasn't exchange closed already? You can only deposit and withdraw now, with 30th Dec being the last date for deposit.

I don't know how much the current system is going to affect the real black money - which is invested in Gold and Property. I wish there was something done to account for that too.

And just one more thing - hindsight is something anyone can have, just that its not really useful.

Last edited by pratyush6 : 9th December 2016 at 16:33.
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Old 9th December 2016, 16:27   #1533
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by Samurai View Post
If long time was given to phase out old currency, it would have resulted in massive laundering. People would be buying all kind of tangible assets and would have caused sharp spike in inflation. Knowing the scale of black economy, that would have been dangerous.
Given the progress on cash deposits, it seems the money has been laundered anyway, hence calling into question the original justification for the aggressive timeline.

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Came across this article today, and I couldn't help laughing. Goals have changed... really?
The primary reason remains the same, to force all large transactions into the banking system.
I'm a bit confused here - what are you saying is the government's goal for this initiative?
take out black money stored as cash, or
kick start the cashless economy in india?

I don't mind going cashless, but then the govt should use the savings from demonetization to sponsor the cashless infrastructure.
The costs of printing, circulating etc cash was taken care of by the govt indirectly through taxes.
Now the govt meanwhile does not have to worry about that cost, while the cost of cashless is being borne by the banks, who have pushed it onto retailers, who have pushed it onto customers.
That's like forcing everybody to use a tolled national highway while closing the parallel state highways, while retaining the tolls and still charging us road tax -
Either the govt should sponsor the cashless infrastructure since it is the one who wants us to use it, or reduce the tax burden correspondingly.

Last edited by greenhorn : 9th December 2016 at 16:39.
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Old 9th December 2016, 16:40   #1534
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by greenhorn View Post
Given the progress on cash deposits, it seems the money has been laundered anyway, hence calling into question the original justification for the aggressive timeline.



I'm a bit confused here - what are you saying is the government's goal for this initiative?
Do you consider depositing in bank as money laundering? The real laundering will happen if money is converted to gold, land, and wades of cash in new currency. The fist two needs time.
The goals of this exercise as stated by Govt
Extinguish the existing black money or bring that to banking system
Promote digital economy
Widen the tax net
Why do you think that any exercise by the govt can have only one goal?
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Old 9th December 2016, 16:41   #1535
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

^^ In a cashless economy, generating large sums of unaccounted wealth is extremely difficult (I wouldn't call it impossible). So it follows that a mostly-cashless economy will be virtually free of black money.

Ever wonder why so many Hollywood flicks have kidnappers asking for the ransom "in small denomination bills"? Or why some banks have a spray paint mechanism to dye the notes with bright colours when they are robbed? It's dashedly difficult to get rid of large swathes of cash in a mostly-white economy. Pre-demonetization, India was mostly-cash!
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Old 9th December 2016, 16:46   #1536
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by greenhorn View Post
I don't mind going cashless, but then the govt should use the savings from demonetization to sponsor the cashless infrastructure.
Well, they are doing it.

http://timesofindia.indiatimes.com/i...w/55875898.cms
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Old 9th December 2016, 16:51   #1537
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Quote:
Originally Posted by poloman View Post
Do you consider depositing in bank as money laundering? The real laundering will happen if money is converted to gold, land, and wades of cash in new currency. The fist two needs time.
The goals of this exercise as stated by Govt
Extinguish the existing black money or bring that to banking system
Promote digital economy
Widen the tax net
Why do you think that any exercise by the govt can have only one goal?
I'm only worried about the goal which made the govt put such an aggressive timeline which has been creating problems.
That was claimed to be black money, and that narrative seems to be spun into other goals which you have mentioned, for which the aggressive timeline wasnt really needed.

I don't consider depositing money in banks as money laundering,

But given the initial premise of the govt that a certain percentage of cash is black, either that projection was optimistic, or a large chunk of that seems to have been laundered somehow into white, which was in turn deposited into banks.

Of the stated goals, none of them really need the overnight sort of demonetization that happened. a phased rollout of 500 & 1000 combined with incentives for large bank transactions should have done it nicely. And the 2K note kinda cancels the whole thing, looking at the seizures being made

Quote:
Originally Posted by Samurai View Post
I hope they do something about the 2-4% transaction charges that banks are charging, even after the govt announced no transaction charges


when the centre collects around 30% as excise on petrol, it could have helped a bit there rather than forcing petrol pumps which are already running on thin margins to cough up a .75% discount.

Last edited by Samurai : 9th December 2016 at 17:17.
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Old 9th December 2016, 17:03   #1538
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

Quote:
Originally Posted by Thad E Ginathom View Post
The absence of cash suggests so.
Is this why there is absence of cash? Remember, these are numbers of only those who were caught. Imagine how many who are not caught.

Quote:
Chennai, December 8
The Income Tax department raided the premises of businessman Sekhar Reddy and his associate Srinivasa Reddy here and seized Rs 90 crore cash including in the new Rs 2,000 notes and 100 kg gold, said officials.


Out of the total cash, around Rs 10 crore was in the newly issued Rs 2,000 notes.
Quote:
Cash worth Rs 43 lakhs in new currency was seized from a television actor and two others on Thursday, police said.
The actor, Rahul Chalani, who features in a popular crime show on the small screen, and two others were on their way to Hoshangabad from Itarsi in an SUV when they were caught with Rs 43 lakh in cash, Kotwali police station inspector Mahendra Chouhan said.
Quote:
PANAJI: Two persons were detained on Wednesday with Rs 70 lakh in the new currency notes of Rs 2,000 denomination even as Rs 1.5 crore in the new notes has been seized across the state in the last 24 hours, police said.
Superintendent of Police Karthik Kashyap told reporters that that two persons identified as Ramesh Narvekar and Siddhu have been detained on a tip-off, after they were caught by the police ferrying the cash on a scooter in the jurisdiction of the Porvorim police station in North Goa.
Quote:
UDUPI: Close on the heels of I-T sleuths confiscating over Rs five crore in Bengaluru, another Rs 71 lakh have been seized from the possession of three persons in Rs 2000 denomination, police said on Sunday.
Someone created a spreadsheet tracking all the money seized and reported in news. You will be amazed to see a whooping Rs. 100 crores in new currency in cash was seized after demonetization. See the link below.

https://docs.google.com/spreadsheets...PkA/edit#gid=0

Now, let's not blame the Govt. There are such people too who is responsible for such shortage.
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Old 9th December 2016, 17:34   #1539
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by pratyush6 View Post
Hasn't exchange closed already? You can only deposit and withdraw now, with 30th Dec being the last date for deposit.
Yep, the exchange of currency notes has closed, but one can still deposit old notes in one's bank account and get new ones up to a certain limit. I assumed that's what the other person referred to, but the last date to deposit is December 30th, not 31st. Why is it one day short? I confess to being curious about it myself.
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Old 9th December 2016, 17:36   #1540
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by nowwhat? View Post
Yep, the exchange of currency notes has closed, but one can still deposit old notes in one's bank account and get new ones up to a certain limit. I assumed that's what the other person referred to, but the last date to deposit is December 30th, not 31st. Why is it one day short? I confess to being curious about it myself.
Could it be because 31st Dec is a Saturday and a bank holiday?
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Old 9th December 2016, 19:28   #1541
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

Quote:
Originally Posted by sukhoi30 View Post
Is this why there is absence of cash? Remember, these are numbers of only those who were caught. Imagine how many who are not caught.

Someone created a spreadsheet tracking all the money seized and reported in news. You will be amazed to see a whooping Rs. 100 crores in new currency in cash was seized after demonetization. See the link below.

https://docs.google.com/spreadsheets...PkA/edit#gid=0

Now, let's not blame the Govt. There are such people too who is responsible for such shortage.
Obviously there is a big leakage in the system and people who knew are using it. Of course the guy who carried 70 lakh did not send 2800 people to withdraw 2500 each.
People who did these kind of stuff knew bigger loopholes which they can use to extract cash out of the system. Do they steal? Carry fake notes? Replace pink notes with similar fake pink notes and change? Scare bank people to somehow get around the system? They only can answer these.

These "smart" individuals do everything they can to stay out of the system. This is why government is trying to push cashless economy now. If every rupee printed so far was white, then the need for going cashless should put everyone into the tax net.
Whether you carried black or white, you would need to pay tax from now on.

We are waiting for January to here from Government, how much additional taxes they collected, or how much cash they did not receive at all.

In any case, the push to go cashless, will only result in widening tax net and will increase cashflow for the banks and for the Government. The net effect will be good for our country. Citizens evading tax will not result in much good.
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Old 9th December 2016, 21:25   #1542
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

I have to say that the current government is really in sync with the large section of population of this country. There is no other reason as to why in just 103 pages and 30 days of discussion all the talk has changed from black money to cashless economy now. Cashless economy may or may not help in generation of more black money but it in no way is going to end the dirty money already into the system. And as per my understanding that was the main motive of this scheme as on November 8, 2016.

The second point is that finally the government is waking up and catching a handful of people with leaked new currency notes, at least now people at large here will believe me when I was saying all along that you can easily get your old dirty money converted into new 2k currency notes at a percentage easily in Delhi ( and in most other cities). So much so for putting an end to black money. BTW since the demand is less now as most people have already converted their stash, the conversion rate is Delhi has fallen down to 10-15% now for hand to hand exchange.

Lastly are you guys really telling/suggesting that a country like India can aim for a 100% cashless economy? And of course without a 100% migration, black money will just keep generating. So in a country where the poll promises still hover around poverty, water, electricity, toilets and reservation, you guys are dreaming about a cashless economy? I do not know what to say to that except that there is no charge for dreaming big. So why not do it eh!

Last edited by drmohitg : 9th December 2016 at 21:27.
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Old 9th December 2016, 22:56   #1543
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

As per the below article, "No service tax on transaction charges on digital payments up to Rs 2,000/transaction"

http://indianexpress.com/article/ind...onomy-4417972/

Can someone please enlighten how advantageous this is for us, and where all should we start using cards to avail the benefits?
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Old 10th December 2016, 00:00   #1544
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

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Originally Posted by sukhoi30 View Post
Could it be because 31st Dec is a Saturday and a bank holiday?
Quite a self congratulatory clap, but I hope you realize that December 31st is a 5th Saturday and normally open.

Quote:
Originally Posted by hybridpetrol View Post
These "smart" individuals do everything they can to stay out of the system. This is why government is trying to push cashless economy now. If every rupee printed so far was white, then the need for going cashless should put everyone into the tax net.
Whether you carried black or white, you would need to pay tax from now on.
I know a bunch of these "smart" individuals myself and sadly they are some of my own relatives. They have been trying very hard to get me to launder their money and I have been resisting as hard as I can so far.
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Old 10th December 2016, 00:04   #1545
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Default Re: Government scraps Rs 500 and Rs 1000 notes!

Quote:
Originally Posted by drmohitg View Post
I have to say that the current government is really in sync with the large section of population of this country. There is no other reason as to why in just 103 pages and 30 days of discussion all the talk has changed from black money to cashless economy now. Cashless economy may or may not help in generation of more black money but it in no way is going to end the dirty money already into the system. And as per my understanding that was the main motive of this scheme as on November 8, 2016.

The second point is that finally the government is waking up and catching a handful of people with leaked new currency notes, at least now people at large here will believe me when I was saying all along that you can easily get your old dirty money converted into new 2k currency notes at a percentage easily in Delhi ( and in most other cities). So much so for putting an end to black money. BTW since the demand is less now as most people have already converted their stash, the conversion rate is Delhi has fallen down to 10-15% now for hand to hand exchange.

Lastly are you guys really telling/suggesting that a country like India can aim for a 100% cashless economy? And of course without a 100% migration, black money will just keep generating. So in a country where the poll promises still hover around poverty, water, electricity, toilets and reservation, you guys are dreaming about a cashless economy? I do not know what to say to that except that there is no charge for dreaming big. So why not do it eh!
IMHO this is just a validation of the fact that people with Black money is incurring substantial cost in conversion of black money to white. For eg - if you had 100 Rs of black money, you are left with anything from 50-80 rs in case you go for conversion and there is also the risk that ED will come after you once they bust one of these big rackets.

I don't think anybody is saying that this will wipe out Black money overnight. What will happen though - People will realize that there is a potential risk in tax evasion and substantial number of lawyers/doctors/business men/salaries folks with other income/family income etc. will realize the risk that they are incurring and will try to curtail the tax evasion that they have been doing all this while.

Overall happy days ahead !!!
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