ECONOMIC REFORMS (LPG)

PART- 3
(ECONOMICS)
SUNIL PANDA- THE EDUCATOR
(2022-23)
INDIAN ECONOMIC DEVELOPMENT
Demonetisation
It is a Situation where the central bank of a country withdraws the
old currency notes of certain denomination as an Official Mode of
Payment.
On 8 November 2016, The Government of India announced the
Demonetisation of all ₹500 and ₹1000 banknotes of the Mahatma
Gandhi series. It was also announced the issuance of New ₹500 and
₹2,000 Banknotes in
exchange for.
More than 105 People had died in the past demonetization. It also hits
small business
It caused loss of 15 lakh jobs
₹500 and ₹1000 Notes were 86% of the total currency in circulation
It was not a good decision because 99.30% of demonetized money back
in the system as per RBI report.
Aim of demonetization
To curb corruption and penalize for illegal Activities
To stop circulation of Black money in the Market
To prevent terror funding
To prevent Tax evasion
To promote cash less economy.
Impact of Demonetisation
a) Bank Deposits increased
b) Decline in Cash transaction
c) Digitisation
d) Real estate prices decreased
e) Rise in income tax Collection
f) Raise Tax Collection
Demonetisation has been done in Various countries like
Nigeria, Zimbawe, Myanmar, Australia, etc.
India also face Demonetization in Year 1946 and 1978
Goods and Services Tax
It is an Indirect Tax Levied on the supply of goods and services.
Passed in Parliament on 29 march 2017
Came into effect 1 July 2017
Before the implementation of GST, Various central, state and local
area taxes were levied in india.
These indirect taxes now subsumed under GST
Which is based on the Principle of “One nation one tax”
Different Common rates of GST
5%
12%
18%
28%
GST structure in India
CGST
SGST
UTGST
IGST
Features of GST
Comprehensive Tax
Multi stage Tax
Value added Tax
Destination Based Tax
Advantages of GST
Simplification of tax procedure
Transparency
Ease of doing business
Technology Driven
Attracting Foreign investment
Contributes to economic growth
THANK YOU