In a significant effort by the Government to bust down on black money, the Government has scrapped notes of 500 and 1000 rupee denominations. The move is one of the greatest strikes to those who earn and store unaccounted income.
10 things you must know
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Money kept in cash in the kind of 500, 1000 rupee notes will be rendered worthless right after December 30, 2016.
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Black money hoarders will be pushed to discover new and innovative ways to store ill-gotten wealth.
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The need for gold and other investment options just like diamonds and silver will shoot via the roof until the deadline, and beyond it.
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Prices of property, which is currently hitting the trough, is more likely to drop even more as almost half of all property dealings are believed to be black money and Benami transactions.
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The move is a big blow to election funding and is sure to affect the Punjab and UP elections scheduled the coming year.
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Almost 16 billion Rs 500 notes and 6 billion Rs 1000 notes are in circulation presently.
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The discontinuing of 500 and 1000 rupee notes, which comprise 84 percent of all currency notes in circulation, has resulted in banks and ATMs across India shutting down for 2 days to put this into effect.
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RBI will have to bear an expense in extra of Rs 10,000 crore to print fresh Rs 500 and Rs 2,000 notes to switch the current Rs 500 and Rs 1000 notes.
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Estimations of domestic black money range from a quarter of our GDP to 2-3 times the size of our GDP.
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Govt has kept suggestions floated for higher denomination currency such as Rs 5,000 and Rs 10,000 notes in abeyance worrying higher black money stash.
