Demonetize the 5000, 1000 notes in Pakistan?

[Indus Pakistan]

Thread to discuss if Pakistan could do with following the Indian example opened at request of @EpiiC Any ideas about reducing corruptio, money laundering etc invited.

 

[EpiiC]

Thread to discuss if Pakistan could do with following the Indian example opened at request of @EpiiC Any ideas about reducing corruptio, money laundering etc invited.

Step 1 is to ensure that majority of the population has bank accounts.

Step 2 is Demonetization. It makes sure ALL the current money goes in the banks and people are forced to use the banking system. .Now IT will also slap penalty for huge cash deposits,by bringing them into tax net

The next step is to ensure that people keep using the banking system and don't fall back on old habits.

Come up with a new law that all salaries from registered companies to their employees must be made by cheque or direct debit. No cash allowed for salaries. This would continue to force some people to use banks.

The last step would be a complete overhaul of laws that lead to black money generation - like reducing stamp duty, change of labor and industrial laws, etc, etc. This is so that black money generation is reduced for the future.

Missing any of the above three steps will lead to the same result - no change in the long run and will be a wasted effort.....

This would double and triple government revenue and improve development and uplift....

According to source DAWN there is $200B Pakistani Money stashed in Swiss Banks!!!!

That $200B could have landed Pak into top 25 Economies in the world...

Currently only 0.5% population pays taxes.

One Member suggested this ..."Getting rid of 5,000 Rupee note would go a long way to curb corruption and black money in Pakistan. Simply have prepaid accounts backed by CNIC's to track transactions. Put stiff penalties on banks for opening accounts under Driver or Janitor's name. Each Account holder should establish their Bank Account after giving proper details regarding their jobs. Accounts should not be opened for " Non-Filers " of Tax Returns."

"Amount of corruption is directly related to the size of Currency notes, I will go as far as saying price is also effected once you introduce bigger currency. example if you bigger currency is Rs. 100 and price of commodity A is Rs. 460, with the availibility of Rs. 500 notes price of commodity A will reach 500...reason: in a cash economy retailers like to keep fewer currency notes as possible.

take 1000 and 5000 currency notes out of circulation and half of Pakistan's problem will go away." - one members suggestion...

black money
noun

1. income illegally obtained or not declared for tax purposes.

 

[M.SAAD]

We will have to wait and see how it pans out for India then decide .


Right now, I don't think its working out well for them ..

 

[Hyde]

Pakistan has been regularly changing the currency notes after every few years so I hardly foresee any real change with that step. If I am not wrong Pakistan has already swapped 500 and 1000 tenders at least twice since past 15 years?

Rich people in Pakistan usually hides their black money in Dollar, Pound and Euro since the value of Pakistani currency have dropped each year

Although I do like the idea of digitalisation and encouraging people to open bank accounts but poor people don't have enough money for savings, that is why we call them poor and middle class already have bank accounts although they don't fully utilise it. The rich class usually have money in foreign currency so it will not effect them too much with demonitization of local currency

 

[Zibago]

Thread to discuss if Pakistan could do with following the Indian example opened at request of @EpiiC Any ideas about reducing corruptio, money laundering etc invited.

Did you see what happened in India?
Sorry dont want to punish our people(more than they already are being punished by the govt)

 

[EpiiC]

We will have to wait and see how it pans out for India then decide .


Right now, I don't think its working out well for them ..

This is one respected Indian Posted...."Buddy if you are serious then let me share with you , why this note ban is good from a person who never studied economics , its India specific such points may not be valid some where else :

1) Fair elections : A lot of such stacked currency notes are used in elections to buy votes distribute liquor , such note ban impact such things , that will lead to the cheap elections .

2) Fake currency : We have a problem of fake currency , which is used in terrorism and drugs ...the Note ban can help in cribbing the fake currency.

3) Poor people in banking system : Due to this note ban a lot of people have opened the bank accounts and become p[art of banking system which push more money in our banking system as of now since 8th more then 150 billion money added in economy.

4) Taxation system : Govt has generated more tax then previous govt we have just 10 million tax payers while atleast 200 million can pay taxes. which will lead to low taxes

5) Impact on corruption : We have a big epidemic of corruption in our country and note ban will defenetly to some extent impact the corruption.

6) Parallel economy : Once we have our money in banking system alot of parallel economy will become part of main economy

We Indians are happy that some one is really trying to improve the system nothing else matters what ever issues this guy has raised we Indians face such issues every day , we are not afraid of standing in queues "

 

[Zain Malik]

No way..
Watch the current status of India....
People are dying just for exchanging new notes..

 

[EpiiC]

Nah. That's just Modiffied chutyapa.

Yh lets just leave 0.5% of the population paying Taxes.... lets leave Pakistan to rot.... and not fight corruption....

 

[Ajaxpaul]

I do believe we will emerge stronger with cashless transaction being adopted slowly but surely.

But the pain continues now...

 

[EpiiC]

No way..
Watch the current status of India....
People are dying just for exchanging new notes..

Look at my solution step 1 go digital prepare the nation first, step 2 is demonetizing... Modi did step 2 first rather than step 1 first.

Pakistan has been regularly changing the currency notes after every few years so I hardly foresee any real change with that step. If I am not wrong Pakistan has already swapped 500 and 1000 tenders at least twice since past 15 years?

Rich people in Pakistan usually hides their black money in Dollars, Pounds and Euros since the value of Pakistani currency have dropped each year

Although I do like the idea of digitalisation and encouraging people to open bank accounts but poor people don't have enough money for savings, that is why we call them poor and middle class already have bank accounts although they don't fully utilise it. The rich class usually have money in foreign currency so it will not effect them too much with demonitization of local currency

I learnt that 100 rupees is all it takes to open a bank account...

I do believe we will emerge stronger with cashless transaction being adopted slowly but surely.

But the pain continues now...

Mate the pain is too much for me to bear.... Countries 25 times smaller than us... have larger economies...

 

[Hyde]

I learnt that 100 rupees is all it takes to open a bank account...

I am not sure about PKR account but they surely asked me to deposit minimum of 100 pounds in order to open foreign currency account

 

[cloud4000]

Demonetisation is not a bad idea for Pakistan either, but its implementation needs to be better than what is happening in India. It's needs to be a gradual process.

Whole purpose of this exercise to get rid of low- and mid-level corruption, which is the bane of most people's misery. How many people in South Asia had to pay a bribe to get anything done, especially when dealing with local or state governments? If this can reduced, it would bring great social and economic benefits to many people.

 

[M.SAAD]

This is one respected Indian Posted...."Buddy if you are serious then let me share with you , why this note ban is good from a person who never studied economics , its India specific such points may not be valid some where else :

1) Fair elections : A lot of such stacked currency notes are used in elections to buy votes distribute liquor , such note ban impact such things , that will lead to the cheap elections .

2) Fake currency : We have a problem of fake currency , which is used in terrorism and drugs ...the Note ban can help in cribbing the fake currency.

3) Poor people in banking system : Due to this note ban a lot of people have opened the bank accounts and become p[art of banking system which push more money in our banking system as of now since 8th more then 150 billion money added in economy.

4) Taxation system : Govt has generated more tax then previous govt we have just 10 million tax payers while atleast 200 million can pay taxes. which will lead to low taxes

5) Impact on corruption : We have a big epidemic of corruption in our country and note ban will defenetly to some extent impact the corruption.

6) Parallel economy : Once we have our money in banking system alot of parallel economy will become part of main economy

We Indians are happy that some one is really trying to improve the system nothing else matters what ever issues this guy has raised we Indians face such issues every day , we are not afraid of standing in queues "

I highly doubt it considering only 6-10% of all the black money is in the cash form, most rich people usually invest the black money in real estate and other things .



and talking about fake currency, I'm hearing that new bundles of fake currency with new notes are already emerging in India, those who have their means of generating fake currency will have no problem doing it with new notes too so the impact on fake currency and corruption is temporary , It won't stop the cycle.



If anything this move has his the lower middle income-middle income people hard who don't have bank accounts or access to the bank accounts.

This move is just a mere temporary illusion of curbing the black money, it won't fix things in the long run unless the system is reformed and changed which is a long and slow process .



There is already enough chaos in Pakistan right now to think about adding more in the form of banning currency notes and causing severe inconvenience for people , like I said we'll have to wait and see for atleast a year or 2 and observe how it works out for India and if it has any significant positive impact on their economy before rushing into applying it here.

 

[I S I]

I am not sure about PKR account but they surely asked me to deposit minimum of 100 pounds in order to open foreign account

Yes, you can open an account with just 100 rupees in most of the banks in Pakistan.

 

[EpiiC]

I highly doubt it considering only 6-10% of all the black money is in the cash form, most rich people usually invest the black money in real estate and other things .



and talking about fake currency, I'm hearing that new bundles of fake currency with new notes are already emerging in India, those who have their means of generating fake currency will have no problem doing it with new notes too so the impact on fake currency and corruption is temporary , It won't stop the cycle.



If anything this move has his the lower middle income-middle income people hard who don't have bank accounts or access to the bank accounts.

This move is just a mere temporary illusion of curbing the black money, it won't fix things in the long run unless the system is reformed and changed which is a long and slow process .



There is already enough chaos in Pakistan right now to think about adding more in the form of banning currency notes and causing severe inconvenience for people , like I said we'll have to wait and see for atleast a year or 2 and observe how it works out for India and if it has any significant positive impact on their economy before rushing into applying it here.

$200B is stashed in Swiss Bank... Mass tax evasion is happening.... when we go digital more people will be forced to use the banking system.... It's not about rushing as we have been in need of this for a very long time... we should have gone digital years ago ....