Rahul must apply his mind, farm income still tax exempt: FM

Rejecting Rahul Gandhi's charge that the demonetisation move has hit farmers, Finance Minister Arun Jaitley today said the Congress leader must "apply his mind" and understand that those in farming will not face any tax whether they keep their money at home or in banks.
He denied Gandhi's charge of common man being inconvenienced because of withdrawal of old Rs 500 and Rs 1000 notes and also rejected former finance minister P Chidambaram's estimation of cost of printing the new Rs 2,000 notes as "highly exaggerated".
"As far as Rahul Gandhi is concerned, he should understand that any person, especially poor and common man, will not face any inconvenience," Jaitley told reporters here.

As agriculture income is exempt from income tax, farmers face no levies whether they keep their money in banks (by depositing old and now withdrawn currency notes) or in their houses, he said, adding that in both cases no tax is levied on them.
"If he keeps (money) in banks, then he can earn interest and money will also be safe. So they will have three advantages -- no need to pay tax, earn interest, and money will be safe. If he stacks money unsafely at home, then he will face hardship," he said. "So before giving such statement, he (Gandhi) should apply his mind and seriously ponder."

Gandhi had in a series of tweets targeted Prime Minister Narendra Modi over the demonetisation move, saying "real culprits" who have stashed black money are "sitting tight" while lives of farmers, small shopkeepers and housewives "have been thrown in utter chaos."

Challenging Chidambaram's reported statement that introducing new currency notes of Rs 2,000 and Rs 500 denomination will cost Rs 18,000-20,000 crore, he said, "It is a highly exaggerated figure which has been mentioned."
"After all when the entire currency is printed the cost would be known," he said.
Chidambaram, he said, had the privilege of becoming the finance minister thrice. "It would have been better if he took steps... In all these three terms, had he taken any step to curtail black money? Which are these steps?"

"Saying that because of local inconveniences, circulation of black money should go on within the country... These kind of alibis to continue black money hardly carry any weight," he said.
On Chidambaram's worries about implementation, he said there would initially be restrictions on withdrawal. "But later on, it is your own money, whatever way you want to use it. Long term, the money is yours, no one is confiscating money."
Asked if the government's move is linked to the upcoming assembly elections in states like Uttar Pradesh, he replied in the negative.
"But if as a result of this decision, elections become cheaper it will be a good beginning," he said.

On reports of Cabinet ministers not being allowed to carry mobile phones in the meeting chaired by Prime Minister Narendra Modi yesterday when the decision was taken, he said, "Well, its part of normal discipline that you don't keep your phones on in Cabinet meeting.