According to latest news deposits above 2.5 lacks have to face  tax and 200% penalty on income mismatch.

http://timesofindia.indiatimes.com/india/Deposits-above-Rs-2-5-lakh-to-face-tax-200-penalty-on-income-mismatch/articleshow/55337762.cms?utm_source=facebook.com&utm_medium=referral&utm_campaign=TOI

usha manohar wrote:

There are bound to be a few stray cases esp when there is anti propaganda by the opposition..but , people are extremely happy by this decision and so is the President of India and several opposition leaders except the communal party of course which is perpetually in a combat mood ! But frankly does their opinion matter ?

Definitely there will be a set of people who are always interested in grabbing the opportunity into dirty game of politics without understanding or pretending to not understand the positive impact. But for sure others also will not welcome this move as they have proliferated heavily on this black market. But their opinion is not so vital as the majority of population is aam aadmi and the white collar tax paying people. Definitely a boost for them

Many women folk keep rs 500 and 1000 as emergency currency at home (including my mother, mother-in-law and myself) . I have in my wallet too, which I keep it as emergency and hardly used it (my money is with me for a year untouched)

Just say, these notes are embedded with GPS and we keep a few notes at home idle, do you think the income tax would trace this as black money (since here the question remains idle time of a money kept at a place) 

It has been clarified that there is no GPS embeddition in notes. So no worry on that account.

Swetha Shenoy wrote:

Many women folk keep rs 500 and 1000 as emergency currency at home (including my mother, mother-in-law and myself) . I have in my wallet too, which I keep it as emergency and hardly used it (my money is with me for a year untouched)

Just say, these notes are embedded with GPS and we keep a few notes at home idle, do you think the income tax would trace this as black money (since here the question remains idle time of a money kept at a place) 

Luckily, we in our family do not keep rs 500 and 1000.denominations.  we keep 100 notes only. I do not know why.

Regarding GPS, I read in the news channels that, RBI's new Rs 2000 note has no GPS has no GPS - nano chip Rs 2000.  and I do not know about 500 and 1000 notes. I think i gave you the required information.

Swetha Shenoy wrote:

Many women folk keep rs 500 and 1000 as emergency currency at home (including my mother, mother-in-law and myself) . I have in my wallet too, which I keep it as emergency and hardly used it (my money is with me for a year untouched)

Just say, these notes are embedded with GPS and we keep a few notes at home idle, do you think the income tax would trace this as black money (since here the question remains idle time of a money kept at a place) 

GPS being enabled in the new notes is a misleading story being spread through whatsapp Swetha.... So dont worry all your money is safe and no one will find it out :)

http://www.news18.com/news/tech/rbi-dismisses-rumours-of-gps-enabled-rs-2000-notes-1310033.html

Oh my! 

Then what is the point of new currency notes without nano chips and GPS? The undisclosed income after exchange with new notes will remain with the people who hide them! 

The people hiding black money are smart, they may generate ways to convert their old notes to new and hide it again the same way it is done now! 

Swetha Shenoy wrote:

Oh my! 

Then what is the point of new currency notes without nano chips and GPS? The undisclosed income after exchange with new notes will remain with the people who hide them! 

The people hiding black money are smart, they may generate ways to convert their old notes to new and hide it again the same way it is done now! 

The logic is :

1. It will be difficult to store the 100s/500s and 2000 the govt will be letting in the market in regulated amounts. Which means there will be only limited number of rs 2000 and more of 100s/500s which will need more space for storing

2. Any amount above 2.5 lakhs which u try to exchange will attract a 200% tax if the source of income can not be shown.

Now it is like spring cleaning and getting rid of all the unwanted stuff and starting a fresh with limited resources while keeping vigilance..it will clean up the financial system completely for once but there will be need for continued monitoring 

It is a one time surgical strike which will suck out some unaccounted money from the system. Liquidity of banks will increase and may result in deposit rates coming down. It has been the aim of this government to bring down lending rates as industry has been constantly demanding it. It will improve their profitability with less effort. senior citizens living off fixed deposits will suffer. Generation of black money can again start with new currency notes as business practices are too skewed towards black money practices. It is not an easy battle.