Former finance minister Arun Jaitley has died on August 24. During his tenure as Finance Minister from 2014 to 2019, Jaitley led many key financial reforms and initiatives.
Here is a look at his major contributions was at the helm of the Finance Ministry.
Implementation of the Goods and Services Tax (GST): The GST aimed to simplify India’s complicated indirect tax structure by combining state and central indirect taxes so as to eliminate the cascading effect (tax on tax), one which saw unanimous approval from all parties and camps.
Creation of the GST Council: The structure of the tax is considered a work in progress, and it has gone through many iterations towards simplification since it was first introduced in July 1, 2017. This was possible over the scrutiny and debate by the finance ministers of the various states and the Centre, which makes up the GST Council. It is considered to be the prime example of cooperative federalism.
Insolvency and Bankruptcy Code (IBC): The introduction of the IBC signalled the beginning of the arduous task of cleaning up the balance sheets of lenders, many of whom were stressed from un-serviceable loans provided to insolvent companies.
Jan Dhan Yojana: This program, which released in 2014, aimed to promote financial inclusion in the rural areas. It introduced a slew of measures such as the introduction of zero-balance bank accounts, and increased access to credit, insurance and pensions.
LTCG tax: The Long Term Capital Gains Tax was a controversial tax which was imposed on profit generated from assets such as shares, real estate and share-oriented products held for a minimum period of one year from the date of acquisition. It was re-introduced after being scrapped in 2004-05 by the-then Finance Minister P Chidambaram.
Public sector banks (PSB) recapitalization: The government introduced a massive recapitalisation initiative to strengthen ailing PSBs. The total amount for bank recapitalisation at Rs 1.06 lakh crore in financial year 2018-19.
Bank mergers: Another initiative that was taken to improve the financial health of PSBs was the merger of smaller banks with larger ones. The most notable being the merger of Bank of Baroda, Dena Bank and Vijaya Bank.
Demonetisation: The controversial move saw the banning of Rs 500 and Rs 1,000 bank notes in the country on November 8, 2016, which led to a severe liquidity problem that hit many for months. This move hit the day-to-day operations of many, right from the ordinary citizen to the operations of micro, small and medium enterprises. This was followed by the issue of Rs 500 and Rs 2,000 bank notes, and the effectiveness of the operation is still under debate.
Disinvestment of PSUs: The disinvestment of the government’s stake in Public Sector Undertakings (PSUs) to minimum required majority was undertaken under Jaitley’s tenure as finance minister to meet its fiscal deficit targets. The disinvestment target for FY20 was pegged at Rs 1,05,000 crore.
Providing tax Exemption: Those earning less Rs 5 lakh per annum were exempt from paying income tax, which was an announcement made Jaitley in his last Union Budget which he presented as finance minister.