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Passage:Various governments have taken steps to tackle the black economy in the last seventy years. Many committees and commissions have been set up to study the problem and they have made thousands of suggestions and hundreds have been implemented.In 2016, demonetisation was announced with a big bang. It caused untold misery to the poor who never generated any black incomes while those generating black incomes and who had accumulated much black wealth went scot-free; the problem did not get solved. The reason is that the underlying cause of the black economy’s existence is not technical or economic but political and that remains unresolved.Proponents of GST have been arguing that it would help tackle the black economy since all inputs and outputs in the entire chain of production and distribution would be computerised. As argued, this is not entirely true for the Indian GST since it has various exemptions and certain key commodities are kept out of its purview.Further, small and cottage sectors are largely outside its scope. More importantly, Indian businesses are adept at keeping two sets of accounts and they can continue to do so.Finally, it is believed that digitisation would help tackle the black economy. It is argued that the informal sector would get formalised and come under the tax net. This is an incorrect understanding of the nature of the black economy in India.Most of the unorganised sector earn incomes way below the taxable limit. To understand this, it is important to know that in India, taxation begins at a multiple of the per capita incomes and income inequality is high. Hence, a vast majority of the people earn incomes way below the taxable limit and do not fall in the tax net. An overwhelming majority of those below the taxable limit belong to the low-paid unorganised and informal sector.Not only is the perception that black incomes are generated in the informal sector incorrect, but there are also other misperceptions about the black economy.For instance, demonetisation was premised on the notion that “black means cash.” This led to theunfortunate conclusion that if cash is squeezed out of the system, then the black economy would disappear at one stroke.It has been argued that the use of technology can help curtail the black economy. It is felt that the human element is incorrigible so it needs to be eliminated from business transactions if the black economy is to be eradicated. The underlying assumption is that the human element can be eliminated in the running of society.This is a flawed notion since it is human beings who operate technology even if the number of human beings running systems can be reduced. As long as human intervention is needed, illegality can persist.The idea that more laws are needed to check the growth of the black economy is also flawed. As explained in a book on the Indian economy by this author there can be no perfect law since human ingenuity can find a way of circumventing any law.Tackling the black economy is a political and societal issue which only movements can address. There is a need to change the consciousness of the public at large so that they demand accountability from their elected representatives. But the public is also compromised.It votes for a person from its own caste, region, community, etc., even if they are corrupt and/or have a criminal background. The public chooses one who will do their work, regardless of legality, given that policies fail. There is also a growing belief that one community can only gain at the expense of others.People have come to believe that it is a zero-sum game and not a positive-sum game. GST does not dismantle the triad and hence cannot tackle the black economy. As argued above, ways to circumvent the GST laws will emerge to enable the black economy to continue, even if its form changes.Q.From the above passage, which of the following conclusions can be inferred?a)Demonetization did not hit the target audience for which it was intended.b)Demonetization largely hit the target audience for which it was intended but also affected some who were not its key targetsc)Demonetization only hit the target audience for which it was intended hence it was highly focused in its impact.d)None of the aboveCorrect answer is option 'A'. Can you explain this answer? for CLAT 2024 is part of CLAT preparation. The Question and answers have been prepared according to the CLAT exam syllabus. Information about Passage:Various governments have taken steps to tackle the black economy in the last seventy years. Many committees and commissions have been set up to study the problem and they have made thousands of suggestions and hundreds have been implemented.In 2016, demonetisation was announced with a big bang. It caused untold misery to the poor who never generated any black incomes while those generating black incomes and who had accumulated much black wealth went scot-free; the problem did not get solved. The reason is that the underlying cause of the black economy’s existence is not technical or economic but political and that remains unresolved.Proponents of GST have been arguing that it would help tackle the black economy since all inputs and outputs in the entire chain of production and distribution would be computerised. As argued, this is not entirely true for the Indian GST since it has various exemptions and certain key commodities are kept out of its purview.Further, small and cottage sectors are largely outside its scope. More importantly, Indian businesses are adept at keeping two sets of accounts and they can continue to do so.Finally, it is believed that digitisation would help tackle the black economy. It is argued that the informal sector would get formalised and come under the tax net. This is an incorrect understanding of the nature of the black economy in India.Most of the unorganised sector earn incomes way below the taxable limit. To understand this, it is important to know that in India, taxation begins at a multiple of the per capita incomes and income inequality is high. Hence, a vast majority of the people earn incomes way below the taxable limit and do not fall in the tax net. An overwhelming majority of those below the taxable limit belong to the low-paid unorganised and informal sector.Not only is the perception that black incomes are generated in the informal sector incorrect, but there are also other misperceptions about the black economy.For instance, demonetisation was premised on the notion that “black means cash.” This led to theunfortunate conclusion that if cash is squeezed out of the system, then the black economy would disappear at one stroke.It has been argued that the use of technology can help curtail the black economy. It is felt that the human element is incorrigible so it needs to be eliminated from business transactions if the black economy is to be eradicated. The underlying assumption is that the human element can be eliminated in the running of society.This is a flawed notion since it is human beings who operate technology even if the number of human beings running systems can be reduced. As long as human intervention is needed, illegality can persist.The idea that more laws are needed to check the growth of the black economy is also flawed. As explained in a book on the Indian economy by this author there can be no perfect law since human ingenuity can find a way of circumventing any law.Tackling the black economy is a political and societal issue which only movements can address. There is a need to change the consciousness of the public at large so that they demand accountability from their elected representatives. But the public is also compromised.It votes for a person from its own caste, region, community, etc., even if they are corrupt and/or have a criminal background. The public chooses one who will do their work, regardless of legality, given that policies fail. There is also a growing belief that one community can only gain at the expense of others.People have come to believe that it is a zero-sum game and not a positive-sum game. GST does not dismantle the triad and hence cannot tackle the black economy. As argued above, ways to circumvent the GST laws will emerge to enable the black economy to continue, even if its form changes.Q.From the above passage, which of the following conclusions can be inferred?a)Demonetization did not hit the target audience for which it was intended.b)Demonetization largely hit the target audience for which it was intended but also affected some who were not its key targetsc)Demonetization only hit the target audience for which it was intended hence it was highly focused in its impact.d)None of the aboveCorrect answer is option 'A'. Can you explain this answer? covers all topics & solutions for CLAT 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Passage:Various governments have taken steps to tackle the black economy in the last seventy years. Many committees and commissions have been set up to study the problem and they have made thousands of suggestions and hundreds have been implemented.In 2016, demonetisation was announced with a big bang. It caused untold misery to the poor who never generated any black incomes while those generating black incomes and who had accumulated much black wealth went scot-free; the problem did not get solved. The reason is that the underlying cause of the black economy’s existence is not technical or economic but political and that remains unresolved.Proponents of GST have been arguing that it would help tackle the black economy since all inputs and outputs in the entire chain of production and distribution would be computerised. As argued, this is not entirely true for the Indian GST since it has various exemptions and certain key commodities are kept out of its purview.Further, small and cottage sectors are largely outside its scope. More importantly, Indian businesses are adept at keeping two sets of accounts and they can continue to do so.Finally, it is believed that digitisation would help tackle the black economy. It is argued that the informal sector would get formalised and come under the tax net. This is an incorrect understanding of the nature of the black economy in India.Most of the unorganised sector earn incomes way below the taxable limit. To understand this, it is important to know that in India, taxation begins at a multiple of the per capita incomes and income inequality is high. Hence, a vast majority of the people earn incomes way below the taxable limit and do not fall in the tax net. An overwhelming majority of those below the taxable limit belong to the low-paid unorganised and informal sector.Not only is the perception that black incomes are generated in the informal sector incorrect, but there are also other misperceptions about the black economy.For instance, demonetisation was premised on the notion that “black means cash.” This led to theunfortunate conclusion that if cash is squeezed out of the system, then the black economy would disappear at one stroke.It has been argued that the use of technology can help curtail the black economy. It is felt that the human element is incorrigible so it needs to be eliminated from business transactions if the black economy is to be eradicated. The underlying assumption is that the human element can be eliminated in the running of society.This is a flawed notion since it is human beings who operate technology even if the number of human beings running systems can be reduced. As long as human intervention is needed, illegality can persist.The idea that more laws are needed to check the growth of the black economy is also flawed. As explained in a book on the Indian economy by this author there can be no perfect law since human ingenuity can find a way of circumventing any law.Tackling the black economy is a political and societal issue which only movements can address. There is a need to change the consciousness of the public at large so that they demand accountability from their elected representatives. But the public is also compromised.It votes for a person from its own caste, region, community, etc., even if they are corrupt and/or have a criminal background. The public chooses one who will do their work, regardless of legality, given that policies fail. There is also a growing belief that one community can only gain at the expense of others.People have come to believe that it is a zero-sum game and not a positive-sum game. GST does not dismantle the triad and hence cannot tackle the black economy. As argued above, ways to circumvent the GST laws will emerge to enable the black economy to continue, even if its form changes.Q.From the above passage, which of the following conclusions can be inferred?a)Demonetization did not hit the target audience for which it was intended.b)Demonetization largely hit the target audience for which it was intended but also affected some who were not its key targetsc)Demonetization only hit the target audience for which it was intended hence it was highly focused in its impact.d)None of the aboveCorrect answer is option 'A'. Can you explain this answer?.

Solutions for Passage:Various governments have taken steps to tackle the black economy in the last seventy years. Many committees and commissions have been set up to study the problem and they have made thousands of suggestions and hundreds have been implemented.In 2016, demonetisation was announced with a big bang. It caused untold misery to the poor who never generated any black incomes while those generating black incomes and who had accumulated much black wealth went scot-free; the problem did not get solved. The reason is that the underlying cause of the black economy’s existence is not technical or economic but political and that remains unresolved.Proponents of GST have been arguing that it would help tackle the black economy since all inputs and outputs in the entire chain of production and distribution would be computerised. As argued, this is not entirely true for the Indian GST since it has various exemptions and certain key commodities are kept out of its purview.Further, small and cottage sectors are largely outside its scope. More importantly, Indian businesses are adept at keeping two sets of accounts and they can continue to do so.Finally, it is believed that digitisation would help tackle the black economy. It is argued that the informal sector would get formalised and come under the tax net. This is an incorrect understanding of the nature of the black economy in India.Most of the unorganised sector earn incomes way below the taxable limit. To understand this, it is important to know that in India, taxation begins at a multiple of the per capita incomes and income inequality is high. Hence, a vast majority of the people earn incomes way below the taxable limit and do not fall in the tax net. An overwhelming majority of those below the taxable limit belong to the low-paid unorganised and informal sector.Not only is the perception that black incomes are generated in the informal sector incorrect, but there are also other misperceptions about the black economy.For instance, demonetisation was premised on the notion that “black means cash.” This led to theunfortunate conclusion that if cash is squeezed out of the system, then the black economy would disappear at one stroke.It has been argued that the use of technology can help curtail the black economy. It is felt that the human element is incorrigible so it needs to be eliminated from business transactions if the black economy is to be eradicated. The underlying assumption is that the human element can be eliminated in the running of society.This is a flawed notion since it is human beings who operate technology even if the number of human beings running systems can be reduced. As long as human intervention is needed, illegality can persist.The idea that more laws are needed to check the growth of the black economy is also flawed. As explained in a book on the Indian economy by this author there can be no perfect law since human ingenuity can find a way of circumventing any law.Tackling the black economy is a political and societal issue which only movements can address. There is a need to change the consciousness of the public at large so that they demand accountability from their elected representatives. But the public is also compromised.It votes for a person from its own caste, region, community, etc., even if they are corrupt and/or have a criminal background. The public chooses one who will do their work, regardless of legality, given that policies fail. There is also a growing belief that one community can only gain at the expense of others.People have come to believe that it is a zero-sum game and not a positive-sum game. GST does not dismantle the triad and hence cannot tackle the black economy. As argued above, ways to circumvent the GST laws will emerge to enable the black economy to continue, even if its form changes.Q.From the above passage, which of the following conclusions can be inferred?a)Demonetization did not hit the target audience for which it was intended.b)Demonetization largely hit the target audience for which it was intended but also affected some who were not its key targetsc)Demonetization only hit the target audience for which it was intended hence it was highly focused in its impact.d)None of the aboveCorrect answer is option 'A'. Can you explain this answer? in English & in Hindi are available as part of our courses for CLAT. Download more important topics, notes, lectures and mock test series for CLAT Exam by signing up for free.

Here you can find the meaning of Passage:Various governments have taken steps to tackle the black economy in the last seventy years. Many committees and commissions have been set up to study the problem and they have made thousands of suggestions and hundreds have been implemented.In 2016, demonetisation was announced with a big bang. It caused untold misery to the poor who never generated any black incomes while those generating black incomes and who had accumulated much black wealth went scot-free; the problem did not get solved. The reason is that the underlying cause of the black economy’s existence is not technical or economic but political and that remains unresolved.Proponents of GST have been arguing that it would help tackle the black economy since all inputs and outputs in the entire chain of production and distribution would be computerised. As argued, this is not entirely true for the Indian GST since it has various exemptions and certain key commodities are kept out of its purview.Further, small and cottage sectors are largely outside its scope. More importantly, Indian businesses are adept at keeping two sets of accounts and they can continue to do so.Finally, it is believed that digitisation would help tackle the black economy. It is argued that the informal sector would get formalised and come under the tax net. This is an incorrect understanding of the nature of the black economy in India.Most of the unorganised sector earn incomes way below the taxable limit. To understand this, it is important to know that in India, taxation begins at a multiple of the per capita incomes and income inequality is high. Hence, a vast majority of the people earn incomes way below the taxable limit and do not fall in the tax net. An overwhelming majority of those below the taxable limit belong to the low-paid unorganised and informal sector.Not only is the perception that black incomes are generated in the informal sector incorrect, but there are also other misperceptions about the black economy.For instance, demonetisation was premised on the notion that “black means cash.” This led to theunfortunate conclusion that if cash is squeezed out of the system, then the black economy would disappear at one stroke.It has been argued that the use of technology can help curtail the black economy. It is felt that the human element is incorrigible so it needs to be eliminated from business transactions if the black economy is to be eradicated. The underlying assumption is that the human element can be eliminated in the running of society.This is a flawed notion since it is human beings who operate technology even if the number of human beings running systems can be reduced. As long as human intervention is needed, illegality can persist.The idea that more laws are needed to check the growth of the black economy is also flawed. As explained in a book on the Indian economy by this author there can be no perfect law since human ingenuity can find a way of circumventing any law.Tackling the black economy is a political and societal issue which only movements can address. There is a need to change the consciousness of the public at large so that they demand accountability from their elected representatives. But the public is also compromised.It votes for a person from its own caste, region, community, etc., even if they are corrupt and/or have a criminal background. The public chooses one who will do their work, regardless of legality, given that policies fail. There is also a growing belief that one community can only gain at the expense of others.People have come to believe that it is a zero-sum game and not a positive-sum game. GST does not dismantle the triad and hence cannot tackle the black economy. As argued above, ways to circumvent the GST laws will emerge to enable the black economy to continue, even if its form changes.Q.From the above passage, which of the following conclusions can be inferred?a)Demonetization did not hit the target audience for which it was intended.b)Demonetization largely hit the target audience for which it was intended but also affected some who were not its key targetsc)Demonetization only hit the target audience for which it was intended hence it was highly focused in its impact.d)None of the aboveCorrect answer is option 'A'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of Passage:Various governments have taken steps to tackle the black economy in the last seventy years. Many committees and commissions have been set up to study the problem and they have made thousands of suggestions and hundreds have been implemented.In 2016, demonetisation was announced with a big bang. It caused untold misery to the poor who never generated any black incomes while those generating black incomes and who had accumulated much black wealth went scot-free; the problem did not get solved. The reason is that the underlying cause of the black economy’s existence is not technical or economic but political and that remains unresolved.Proponents of GST have been arguing that it would help tackle the black economy since all inputs and outputs in the entire chain of production and distribution would be computerised. As argued, this is not entirely true for the Indian GST since it has various exemptions and certain key commodities are kept out of its purview.Further, small and cottage sectors are largely outside its scope. More importantly, Indian businesses are adept at keeping two sets of accounts and they can continue to do so.Finally, it is believed that digitisation would help tackle the black economy. It is argued that the informal sector would get formalised and come under the tax net. This is an incorrect understanding of the nature of the black economy in India.Most of the unorganised sector earn incomes way below the taxable limit. To understand this, it is important to know that in India, taxation begins at a multiple of the per capita incomes and income inequality is high. Hence, a vast majority of the people earn incomes way below the taxable limit and do not fall in the tax net. An overwhelming majority of those below the taxable limit belong to the low-paid unorganised and informal sector.Not only is the perception that black incomes are generated in the informal sector incorrect, but there are also other misperceptions about the black economy.For instance, demonetisation was premised on the notion that “black means cash.” This led to theunfortunate conclusion that if cash is squeezed out of the system, then the black economy would disappear at one stroke.It has been argued that the use of technology can help curtail the black economy. It is felt that the human element is incorrigible so it needs to be eliminated from business transactions if the black economy is to be eradicated. The underlying assumption is that the human element can be eliminated in the running of society.This is a flawed notion since it is human beings who operate technology even if the number of human beings running systems can be reduced. As long as human intervention is needed, illegality can persist.The idea that more laws are needed to check the growth of the black economy is also flawed. As explained in a book on the Indian economy by this author there can be no perfect law since human ingenuity can find a way of circumventing any law.Tackling the black economy is a political and societal issue which only movements can address. There is a need to change the consciousness of the public at large so that they demand accountability from their elected representatives. But the public is also compromised.It votes for a person from its own caste, region, community, etc., even if they are corrupt and/or have a criminal background. The public chooses one who will do their work, regardless of legality, given that policies fail. There is also a growing belief that one community can only gain at the expense of others.People have come to believe that it is a zero-sum game and not a positive-sum game. GST does not dismantle the triad and hence cannot tackle the black economy. As argued above, ways to circumvent the GST laws will emerge to enable the black economy to continue, even if its form changes.Q.From the above passage, which of the following conclusions can be inferred?a)Demonetization did not hit the target audience for which it was intended.b)Demonetization largely hit the target audience for which it was intended but also affected some who were not its key targetsc)Demonetization only hit the target audience for which it was intended hence it was highly focused in its impact.d)None of the aboveCorrect answer is option 'A'. Can you explain this answer?, a detailed solution for Passage:Various governments have taken steps to tackle the black economy in the last seventy years. Many committees and commissions have been set up to study the problem and they have made thousands of suggestions and hundreds have been implemented.In 2016, demonetisation was announced with a big bang. It caused untold misery to the poor who never generated any black incomes while those generating black incomes and who had accumulated much black wealth went scot-free; the problem did not get solved. The reason is that the underlying cause of the black economy’s existence is not technical or economic but political and that remains unresolved.Proponents of GST have been arguing that it would help tackle the black economy since all inputs and outputs in the entire chain of production and distribution would be computerised. As argued, this is not entirely true for the Indian GST since it has various exemptions and certain key commodities are kept out of its purview.Further, small and cottage sectors are largely outside its scope. More importantly, Indian businesses are adept at keeping two sets of accounts and they can continue to do so.Finally, it is believed that digitisation would help tackle the black economy. It is argued that the informal sector would get formalised and come under the tax net. This is an incorrect understanding of the nature of the black economy in India.Most of the unorganised sector earn incomes way below the taxable limit. To understand this, it is important to know that in India, taxation begins at a multiple of the per capita incomes and income inequality is high. Hence, a vast majority of the people earn incomes way below the taxable limit and do not fall in the tax net. An overwhelming majority of those below the taxable limit belong to the low-paid unorganised and informal sector.Not only is the perception that black incomes are generated in the informal sector incorrect, but there are also other misperceptions about the black economy.For instance, demonetisation was premised on the notion that “black means cash.” This led to theunfortunate conclusion that if cash is squeezed out of the system, then the black economy would disappear at one stroke.It has been argued that the use of technology can help curtail the black economy. It is felt that the human element is incorrigible so it needs to be eliminated from business transactions if the black economy is to be eradicated. The underlying assumption is that the human element can be eliminated in the running of society.This is a flawed notion since it is human beings who operate technology even if the number of human beings running systems can be reduced. As long as human intervention is needed, illegality can persist.The idea that more laws are needed to check the growth of the black economy is also flawed. As explained in a book on the Indian economy by this author there can be no perfect law since human ingenuity can find a way of circumventing any law.Tackling the black economy is a political and societal issue which only movements can address. There is a need to change the consciousness of the public at large so that they demand accountability from their elected representatives. But the public is also compromised.It votes for a person from its own caste, region, community, etc., even if they are corrupt and/or have a criminal background. The public chooses one who will do their work, regardless of legality, given that policies fail. There is also a growing belief that one community can only gain at the expense of others.People have come to believe that it is a zero-sum game and not a positive-sum game. GST does not dismantle the triad and hence cannot tackle the black economy. As argued above, ways to circumvent the GST laws will emerge to enable the black economy to continue, even if its form changes.Q.From the above passage, which of the following conclusions can be inferred?a)Demonetization did not hit the target audience for which it was intended.b)Demonetization largely hit the target audience for which it was intended but also affected some who were not its key targetsc)Demonetization only hit the target audience for which it was intended hence it was highly focused in its impact.d)None of the aboveCorrect answer is option 'A'. Can you explain this answer? has been provided alongside types of Passage:Various governments have taken steps to tackle the black economy in the last seventy years. Many committees and commissions have been set up to study the problem and they have made thousands of suggestions and hundreds have been implemented.In 2016, demonetisation was announced with a big bang. It caused untold misery to the poor who never generated any black incomes while those generating black incomes and who had accumulated much black wealth went scot-free; the problem did not get solved. The reason is that the underlying cause of the black economy’s existence is not technical or economic but political and that remains unresolved.Proponents of GST have been arguing that it would help tackle the black economy since all inputs and outputs in the entire chain of production and distribution would be computerised. As argued, this is not entirely true for the Indian GST since it has various exemptions and certain key commodities are kept out of its purview.Further, small and cottage sectors are largely outside its scope. More importantly, Indian businesses are adept at keeping two sets of accounts and they can continue to do so.Finally, it is believed that digitisation would help tackle the black economy. It is argued that the informal sector would get formalised and come under the tax net. This is an incorrect understanding of the nature of the black economy in India.Most of the unorganised sector earn incomes way below the taxable limit. To understand this, it is important to know that in India, taxation begins at a multiple of the per capita incomes and income inequality is high. Hence, a vast majority of the people earn incomes way below the taxable limit and do not fall in the tax net. An overwhelming majority of those below the taxable limit belong to the low-paid unorganised and informal sector.Not only is the perception that black incomes are generated in the informal sector incorrect, but there are also other misperceptions about the black economy.For instance, demonetisation was premised on the notion that “black means cash.” This led to theunfortunate conclusion that if cash is squeezed out of the system, then the black economy would disappear at one stroke.It has been argued that the use of technology can help curtail the black economy. It is felt that the human element is incorrigible so it needs to be eliminated from business transactions if the black economy is to be eradicated. The underlying assumption is that the human element can be eliminated in the running of society.This is a flawed notion since it is human beings who operate technology even if the number of human beings running systems can be reduced. As long as human intervention is needed, illegality can persist.The idea that more laws are needed to check the growth of the black economy is also flawed. As explained in a book on the Indian economy by this author there can be no perfect law since human ingenuity can find a way of circumventing any law.Tackling the black economy is a political and societal issue which only movements can address. There is a need to change the consciousness of the public at large so that they demand accountability from their elected representatives. But the public is also compromised.It votes for a person from its own caste, region, community, etc., even if they are corrupt and/or have a criminal background. The public chooses one who will do their work, regardless of legality, given that policies fail. There is also a growing belief that one community can only gain at the expense of others.People have come to believe that it is a zero-sum game and not a positive-sum game. GST does not dismantle the triad and hence cannot tackle the black economy. As argued above, ways to circumvent the GST laws will emerge to enable the black economy to continue, even if its form changes.Q.From the above passage, which of the following conclusions can be inferred?a)Demonetization did not hit the target audience for which it was intended.b)Demonetization largely hit the target audience for which it was intended but also affected some who were not its key targetsc)Demonetization only hit the target audience for which it was intended hence it was highly focused in its impact.d)None of the aboveCorrect answer is option 'A'. Can you explain this answer? theory, EduRev gives you an ample number of questions to practice Passage:Various governments have taken steps to tackle the black economy in the last seventy years. Many committees and commissions have been set up to study the problem and they have made thousands of suggestions and hundreds have been implemented.In 2016, demonetisation was announced with a big bang. It caused untold misery to the poor who never generated any black incomes while those generating black incomes and who had accumulated much black wealth went scot-free; the problem did not get solved. The reason is that the underlying cause of the black economy’s existence is not technical or economic but political and that remains unresolved.Proponents of GST have been arguing that it would help tackle the black economy since all inputs and outputs in the entire chain of production and distribution would be computerised. As argued, this is not entirely true for the Indian GST since it has various exemptions and certain key commodities are kept out of its purview.Further, small and cottage sectors are largely outside its scope. More importantly, Indian businesses are adept at keeping two sets of accounts and they can continue to do so.Finally, it is believed that digitisation would help tackle the black economy. It is argued that the informal sector would get formalised and come under the tax net. This is an incorrect understanding of the nature of the black economy in India.Most of the unorganised sector earn incomes way below the taxable limit. To understand this, it is important to know that in India, taxation begins at a multiple of the per capita incomes and income inequality is high. Hence, a vast majority of the people earn incomes way below the taxable limit and do not fall in the tax net. An overwhelming majority of those below the taxable limit belong to the low-paid unorganised and informal sector.Not only is the perception that black incomes are generated in the informal sector incorrect, but there are also other misperceptions about the black economy.For instance, demonetisation was premised on the notion that “black means cash.” This led to theunfortunate conclusion that if cash is squeezed out of the system, then the black economy would disappear at one stroke.It has been argued that the use of technology can help curtail the black economy. It is felt that the human element is incorrigible so it needs to be eliminated from business transactions if the black economy is to be eradicated. The underlying assumption is that the human element can be eliminated in the running of society.This is a flawed notion since it is human beings who operate technology even if the number of human beings running systems can be reduced. As long as human intervention is needed, illegality can persist.The idea that more laws are needed to check the growth of the black economy is also flawed. As explained in a book on the Indian economy by this author there can be no perfect law since human ingenuity can find a way of circumventing any law.Tackling the black economy is a political and societal issue which only movements can address. There is a need to change the consciousness of the public at large so that they demand accountability from their elected representatives. But the public is also compromised.It votes for a person from its own caste, region, community, etc., even if they are corrupt and/or have a criminal background. The public chooses one who will do their work, regardless of legality, given that policies fail. There is also a growing belief that one community can only gain at the expense of others.People have come to believe that it is a zero-sum game and not a positive-sum game. GST does not dismantle the triad and hence cannot tackle the black economy. As argued above, ways to circumvent the GST laws will emerge to enable the black economy to continue, even if its form changes.Q.From the above passage, which of the following conclusions can be inferred?a)Demonetization did not hit the target audience for which it was intended.b)Demonetization largely hit the target audience for which it was intended but also affected some who were not its key targetsc)Demonetization only hit the target audience for which it was intended hence it was highly focused in its impact.d)None of the aboveCorrect answer is option 'A'. Can you explain this answer? tests, examples and also practice CLAT tests.