Prime Minister Narendra Modi’s November 8 announcement on demonetisation sent ripples of confusion, shock and disappointment across the country. While a lot of people immediately made beelines to the nearest ATM, others threw up their hands, criticising the PM for the unprecedented move and wondering what to do next.
But the theory is apparently not new, and not even Modi’s brainchild. The theory was suggested a long time back by a chartered accountant Anil Bokil, who is part of a Pune-based group called ‘Arthakranti Sansthan’. Speaking to indianexpress.com, his colleague Ashutosh Phalke confirmed that Bokil had chat with Modi, in which he suggested that that the demonetisation strategy will also help curb the circulation of fake currency. Apparently, Bokil had been allotted a couple of minutes to speak to the Prime Minister, but his suggestions intrigued Modi so much that the conversation lasted for around 2 hours.
Apparently, the Arthakranti team has been influencing decision-making for quite some time now. According to The Huffington Post, in March 2007, the then governor of Rajasthan, Pratibha Patil, wrote to Somnath Chatterjee, the then Lok Sabha Speaker, to give the group a chance to present their plans before Parliament members.
The ArthaKranti theory, which was widely circulated on social media platforms such as WhatsApp and Reddit way back in 2014, lists a five-point action that guarantees “solution of Black Money Generation, Price rise and Inflation, Corruption, Fiscal Deficit, Unemployment, Ransom, GDP and industrial growth, terrorism and good governance”.
Subsequently, a video (linked above) showing Bokil explaining how demonetising high-value currency notes will help curb the black money problem, because people will then be forced to exchange their money at banks, thus bringing them into the digital and financial system, is being widely shared online as well.
This is the viral message that talks about demonetisation, among other things:
What is Arthakranti Proposal and who hasgiven the proposal?
“Arthakranti Proposal” has been given by a Pune (Maharashtra) based “Arthakranti Sansthan” which is an Economic Advisory body constituted by a group of Chartered Accountants and Engineers. This funda has been patented by the Sansthan
Arthakranti Proposal is an effective and guaranteed solution of Black Money Generation, Price rise and Inflation, Corruption, Fiscal Deficit, Unemployment, Ransom, GDP and industrial growth, terrorism and good governance
What is in the Proposal ?
“Arthakranti Proposal has FIVE point of actions simultaneously
(1) Scrap all 56 Taxes including income tax excluding import duty
(2) Recall and scrap high denomination currencies of 1000, 500 and 100 rupees
(3) All high value transaction to be made only through banking system like cheque, DD, online and electronic
(4) Fix limit of cash transaction and no taxing on cash transaction
(5) For Govt. revenue collection introduce single point tax system through banking system – Banking Transaction Tax (2% to 0.7%) on only Credit Amount
Important Points to note:
(1) As on today total banking transaction is more than 2.7 lakh crores per day say more than 800 lakh crores annually
(2) Less than 20% transaction is made through banking system as on today and more than 80% transaction made in cash only, which is not traceable
(3) 78% of Indian population spend less than 20/- rupees daily why they need 1000/- rupee note
What will happen if All FIFTY SIX Taxes including income tax scrapped :
(1) Salaried people will bring home more money which will increase purchasing power of the family
(2) All commodities including Petrol, Diesel, FMCG will become cheaper by 35% to 52%
(3) No question of Tax evasion so no black money generation
(4) Business sector will get boosted. So self employment
What will happen if 1000/ 500/ 100 Rupees currency notes recalled and scrapped :
(1) Corruption through cash will stopped 100%
(2) Black money will be either converted to white or will vanish as billions of 1000/500/100 currency notes hidden in bags without use will become simple pieces of papers
(3) Unaccounted hidden huge cash is skyrocketing the prices of properties, land, houses, jewellery etc and hard earned money is loosing its value; this trend will stop immediately
(4) Kidnapping and ransom, “Supari killing” will stop
(5) Terrorism supported by cash transaction will stop
(6) Cannot buy high value property in cash showing very less registry prices
(7) Circulation of “Fake Currency” will stop because fake currency printing for less value notes will not be viable
What will happen when Banking Transaction Tax (2% to 0.7%) is implemented :
(1) As on today if BTT is implemented govt can fetch 800 x 2% = 16 lakh crore where as current taxing system is generating less than 14 lakh crore revenue
(2) When 50% of total transaction will be covered by BTT sizing 2000 to 2500 lakh crores, Govt will need to fix BTT as low as 1% to 0.7% and this will boost again banking transaction many fold
(3) No separate machinery like income tax department will be needed and tax amount will directly deposited in State/Central/District administration account immediately
(4) As transaction tax amount will be very less, public will prefer it instead paying huge amount against directly/indirectly FIFTY SIX taxes
(5) There will be no tax evasion and govt will get huge revenue for development and employment generation
(6) For any special revenue for special projects, govt can slightly raise BTT say from 1% to 1.2% and this 0.2% increase will generate 4,00,000 crores additional fund
Effect if implemented today :
(1) Prices of all things will come down
(2) Salaried people will get more cash in hand
(3) Purchasing power of Society will increase
(4) Demand will boost, so will production and industrialisation and ultimately more employment opportunity for youth
(5) Surplus revenue to the govt for effective health/ education/ infrastructure/ security/ social works
(6) Cheaper and easy loans from banks, interest rate will come down
(7) Tendency of society will changes from scarcity to quantity
(8) Spare money for political system for clean politics,
(9) Prices of land/ property will come down,
(10) No need to export beef to cover up trade deficit
(11) Sufficient funds for research and development
(12) Society will be free from “Bad elements”
Subsequently, a video showing Bokil explaining how demonetising high-value currency notes will help curb the black money problem, because people will then be forced to exchange their money at banks, thus bringing them into the digital and financial system, is being widely shared online as well.