2000 Note – An Intelligent Move by Modi

The Introduction of 2000 Note is being criticized by many as they feel this will make Black Money hoarding very easy. But then the government seems to have given it a good thought and this 2000 Note idea is an intelligent step to counter black money as per a Chartered Accountant’s analysis from Surat. For example, if a person is trying to convert One Lakh of Black Money as 10000 Per day. He will do that in 10 days time.

[m9ad]

If there are 1000 Notes, he would give 10000 Old Money and take home 10000 in New Notes. Next day he brings another bundle and keeps changing. He can later claim with the Income Tax Department he just kept depositing and withdrawing the only 10000 Rupees with him multiple times and is not liable for Tax.

In this case, 10000 Bundle every day are being exchanged with 2000 Notes. So he can not claim that he is depositing and withdrawing the same bundle. Every day he takes home 2000 Notes and comes back with 1000 Notes New Bundle. So, 2000 Notes play important role in Black Money Elimination and then they can be demonetized later if there is a problem of hoarding.

But then the demonetization of 2000 Notes if that happens will not happen as it is being done today. Reserve Bank of India will slowly decrease their printing and at one stage, it will take back all the 2000 Notes that comes to Bank on different occasions. At one stage when the Notes stop coming, that will mean hoarding is happening. The government will demonetize them once again.