It has been announced that now 1000 and 500 Rs notes will be discontinued. This is done with the vision to get out the black money.
So how this will get back the black money.
- 80-90% of black money which is in Cash will be in these notes only so if it is discontinued either the black money holder has to deposit it in some banks like the one very popular among black money holders, the Swiss Bank. So this bank is going to make a lot of money.
- So if they are not able to submit to swiss bank the only thing left for them is to invent methods like having farm houses which does not have to pay taxes and thus convert the money to white only by midnight which is not possible.
- So if these black money holder are not able to submit all their money in Indian bank which they may not as it will prove that they are black money holder. In such case all the money will be like burnt and you know if you burn 1000 Rs note Indian government gets richer by 996 Rs.
What happens when you burn 1000 Rs notes.
- If they don’t take out the black money then it will be of no use. But if they submit this money back Indian government will get a huge amount of money i.e. around 2.1 billion US dollar.
- So It will be loss of money for RBI if they did not take out the money. But its a great great step from this government to get into black money.
- Introduction of new 500 and 2000 Rs notes has been announced.
- People can deposit notes of Rs 1,000 and Rs 500 in their banks from November 10 till December 30, 2016.
What to do with your notes right now.
Here are some instructions from Government of India.
For more insight you can read this quora answers
We will continue the discussion of what will be the aftermaths of this in comments. Please and i will keep updating the Article.