Context
But individuals can give funds by cheque or through digital mode
What has happened?
In the Union Budget 2017-18, there has been proposed a ₹2,000 ceiling on cash donation by any individual to a party. Political parties, however, could receive donations by cheque or digital mode from donors
Further announcements
• Amending the RBI Act: The Reserve Bank of India Act would be amended to facilitate issuance of electoral bonds in line with the scheme that the government would come out
A donor can purchase bonds from authorized banks against cheque and digital payments
Bonds shall be redeemable only in the designated account of a registered political party. And, they will be redeemable within the prescribed time limit from issuance of bonds.
• File IT returns within time: The budget also made it mandatory for political parties to file returns within a time limit
Counter to this move
The limit of ₹2,000 on cash donations to political parties is meaningless as such transfers are mostly unreported. In the absence of a limit on corporate funding of political parties and overall limit on election expenditure of political parties, the so-called reform of political funding means nothing
