Four years after demonetization, the LocalCircles survey found that citizens transacted in cash without a receipt mainly to buy groceries and pay domestic staff.

Nearly 50 citizens still make regular monthly purchases without receipt LocalCircles
Money Survey Monday, November 09, 2020 - 18:48

Four years after demonetisation, nearly 50% citizens still make regular purchases without a receipt, a survey by community and social media platform LocalCircles to understand citizens’ purchasing habits found. Of this, 14% said that 50-100% of their purchases were without a receipt. 

In addition, the survey also found that such purchases without receipt were mainly made in cash for groceries (39%), salaries of domestic staff'' (31%), discretionary purchases, among others. Interestingly, 7% said “bribes”, while 10% said they didn’t make any purchases in cash. 

Aimed at reducing black money, the Government of India on November 8, 2016 demonetised Rs 500 and 1,000 notes. However, LocalCircles notes in its survey that “experts argue that black money is back again in the system and demonetisation only managed to reduce the supply of it for a few years”. 

Responding to what the government should do to further reduce black money in India, 33% said “make linking of all property ownerships with Aadhaar mandatory”, 38% said “mandatory disclosure of all assets of all ministries and government employees and their direct families,” 10% suggested demonetising Rs 2,000 rupee note immediately, while 7% said there should be a levy of 2% transaction tax on all cash transactions above Rs 10,000. 

The survey received over 45,000 responses from more than 300 districts of India. 51% respondents were from tier 1, 34% from tier 2, and 15% from tier 3, 4 and rural districts.

Citizens on the platform have pointed to various areas where people transact in cash to evade taxes paid to the government, via commission agents, middlemen, or brokers. People have also highlighted that even for many MSMEs (micro, small & medium enterprises), real-estate sales and purchase, sale and purchase of agricultural land, transactions continue to take place without an invoice as a norm. 

“It should be a conscious effort of citizens, businesses and the governments to join forces to drastically reduce the black money in India, starting from asking for a cash receipt, bill or invoice for every product or service we procure or sell,” LocalCircles says.

LocalCircles said that it will be sharing these findings with key stakeholders in the government for their understanding and action.

Show us some love and support our journalism by becoming a TNM Member - Click here.