Australia may soon follow India's footsteps by scrapping the nation's highest-denomination currency note in an attempt to crack down on "black economy" in the country.
Indian Prime Minister Narendra Modi had announced last month on November 8 that the government was scrapping Rs 500 and Rs 1,000 notes and the public had 50 days to deposit their old notes in a bank. The decision was taken by the Indian government to crack down on black money circulating in the economy. The decision, however, caused chaos in the country with serpentine lines forming outside banks and ATMs, immediately after the announcement.
The Revenue and Financial Services Minister Kelly O'Dwyer, while talking to ABC ratio, said that a review of $100 note and cash payments over certain limits could be flagged as the Australian government is looking to recover billions of dollars in unpaid tax.
Reports state that Monday's midyear budget in the country will also include the former KPMG global chairman Michael Andrew's appointment to oversee the assigned taskforce for black economy. Considering many cash payments in the country are untaxed, the black economy in Australia amounts to 1.5 percent of the country's GDP.
O'Dwyer also said that the lost revenue in black economy is owed to the Australian people for their hospitals and schools, and it is important to recover all that money for those who abide by the rules and pay their taxes.
"The whole point of this crackdown on the black economy is to make sure we close down any potential loopholes," O'Dwyer told ABC. She also said that the $100 are three times more in circulation than $5 in the nation, amounting to 300 million of $100 currency in the country.
The minister said that she would not rule out the possibility of scrapping $100 notes, although adding that it is up to the expert panel to provide recommendations on such matters. "There's nothing wrong with cash per se, the issue is when people don't declare it and when they don't pay tax on it," she said.
