What is the positive outcome of demonetization in terms of tax administration?
Answer & explanation
Correct answer: option 2
The correct answer is option 2- Channelizing savings into formal financial systems.
Demonetisation led to tax administration by channelizing savings into the formal financial system. Though, much of the cash that has been deposited in the banking system is bound to be withdrawn but some of the new deposits schemes offered by the banks will continue to provide a base loans, at lower interest rates.