Sir — This refers to the article, “A decent Budget, but niggling issues remain” (February 7) by Sandhya Jain. The writer has referred to the joint impact of demonetisation and the Budget in the short run and long term. With demonetisation, the Prime Minister has increased deposits in the banks. The base of the taxable economy has, therefore, expanded several times more than it was before. This will increase tax money to a large extent, which was earlier hidden in households. It will in turn offer funds for poverty reduction and improvement in services to needy to a very large extent.
With the expansion of the banking sector, the Government has come to control the economy and investment to a considerable extent to increase lending and savings. The stagnant banking sector has been strengthened. Finally, with the reduction of income tax rate from 10 per cent to five per cent up to five lakh rupees per annum income, and on other slabs as well, the direct tax collection will increase and people will not feel harassed due to the imposition of high tax. People will feel the pride of paying tax as a mark of public dignity . There is scope for further improvement, but an excellent beginning has been made.