For the women of India , can the dark cloud of
Demonetization , turn out to be one with a " Golden
Lining " ?
Could the drive to eliminate BLACK MONEY , result into "
Women
Empowerment " ?
If you cannot see the connection , please consider the
following :
# Value of withdrawn notes of Rs 500 / 1000
= Approx Rs 15 lakh*crore
# Of the above ,(approx ) Rs 10 lakh*crore worth
notes are with public ( rest with banks )
# Of Rs 10
lakh*crore, may be 50% gets returned to RBI ( Approx Rs 5 lakh*crore )
# Remaining 50
% may get burnt / destroyed ( Rs 5 lakh*crore )
# But , at 23 % of GDP , India's BLACK ECONOMY
is valued at Rs 39 lakh*crore
# Which means , Rs 34 lakh*crore
( Rs 39 Lakh*cr - Rs 5 Lakh*cr of Black Cash which got
burnt ) are
in the form of either GOLD or PROPERTY
# Let us assume
that 50 % of that Rs 34 lakh*crore is in the form of GOLD BISCUITS
# There is no
way , RBI can withdraw those GOLD BISCUITS . No demonetization possible !
So , what will the holders of those GOLD BISCUITS do to
escape the raids of IT / ED ?
Simple !
Give these ( of course , gradually over a period of few
years ) as GIFTS
to ladies of the family as " Stri-Dhan ", where Income Tax provisions are
as follows :
# " Gold / Jewellery
" are WEALTH and subject to WEALTH TAX
# If a lady declares in her Wealth Tax return , wealth
in excess of Rs
30 lakh, she has to
pay 1 % Wealth Tax ( even if she has no regular
income tax liability ? )
# During a RAID
by IT dept , there can be no seizure of GOLD as follows :
* 500 gms ( approx 50 tolas , worth Rs 15 lakh ) , in
case of " married " women
* 250 gms ( approx 25 tolas , worth Rs 7.5 lakh ) , in case of " unmarried " women
# There can be
no seizure of ornaments which are already declared in Wealth Tax returns
# " Stri-Dhan
" ( including all Gold Ornaments
) given by parents on occasion of the
marriage of
a girl , is NON TAXABLE
# Of India's 810
million adults , approx 405 million are WOMEN
# Of India's 30
million persons who file Income Tax returns , maybe 5 million are
women , leaving out 400 million women who do not file
Income Tax returns
# Assume that ,
200 million are " Married " and 200 million are " Unmarried
" women
# At the
permissible limits of Rs 15 lakh ( 500 gms ) and Rs 7.5 lakh ( 250 gms ),
between them
, they can hold " Stri-Dhan " ( valued at Rs 45 lakh*crores ) ,
without
any wealth
tax liability !
When 2015-16 year tax returns get filed, expect a large
number of women coming forward to file their Wealth Tax returns !
Especially those , who got married during current tax-year
!
And what about those ladies whose parents expired , without
a formal / legal " Will " ? Can
they say , " Before her death , my mom gave me her jewellery of 500 grams "
?
Could these women, possibly declare their " Stri-Dhan
" gifts , in excess of Rs 30 lakh ?
As long as the evil of Personal Income Tax / Wealth Tax
continues , expect people to come up with innovative ideas to avoid tax legally
Some will even try to " Evade " tax illegally
, like that businessman from Surat who was nabbed at the Airport yesterday ,
with 2.5 kg of Gold Biscuits , which he had purchased for Rs 90 lakhs ( using
OLD notes ), which would have cost him only Rs 60 lakhs in NEW notes !
His idea was to sell this gold abroad in foreign
currency - then find a way back through hawala transaction !
What does this portend for some Rs 35 lakh*crore worth
of BLACK MONEY , squirreled away by Indians into foreign banks , during past 10
years ?
Will that return to India in GOLD , as " Stri-Dhan
" ? Anybody's guess !
But if abolition of Personal Income Tax, is considered
" too risky " , what stops the NDA government from embedding RFID
micro-sensors in Rs 500 / 1000 / 2000 notes ?
That simple / cheap / fast , step could also put a
permanent STOP to future generation of BLACK MONEY !
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19 Nov 2016
www.hemenparekh.in / blogs
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