The Congress party's stiff opposition to demonetisation has cost the party dear as the government's decision got overwhelming support from the poor, the senior BJP leader said in a Facebook post.
The BJP registered an unprecedented win in municipal elections in Maharashtra and made significant gains in the eastern state of Odisha.
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Hitting out at the current Congress leadership, Jaitley said that if the current representative of the "dynasty lacks the ability to lead the party or the country, the party suffers. It becomes a crowd around a fading dynasty. This now seems obvious in the case of the Congress".
The Congress, he said, has "lost its image as a responsible political organisation". "From a natural party of governance, it has moved to the fringe. Its policies have alienated its constituency of the poor aam aadmi," he added.
Jaitley further said parties which adopt dynastic succession as an alternative to merit-based leadership creation suffer from a natural disadvantage.
"Tall leaders do not grow in such parties. The strength of the party overlaps with the charisma of the current generation of the dynasty," he said.
Referring to note ban decision, the minister said the Congress' stand on demonetisation of high-value currency "is costing it dearly".
"The poor have overwhelmingly supported demonetisation. The Congress party has lost its traditional constituency of the poor electorate to the BJP," the minister said.
He said the disruptive role played by the Congress in Parliament has projected it "more as a fringe rather than a mainstream political party".
Dubbing the Congress as "anti-reformist and anti-growth", Jaitley in the post titled 'The squeezing out the Congress Party' said it refuses to accept the reality that it is out of power now and scandals continue to tumble out from its rule between 2004 and 2014.
Taking a dig at the current Congress leadership, he said "the strength of the party overlaps with the charisma of the current generation of the dynasty".
He noted that the Congress "got squeezed out" in Odisha while it got pushed to the third and fourth places in most cities in Maharashtra.
The finance minister stepped up his pitch, saying the Congress is not even a major contestant in Tamil Nadu, West Bengal and Uttar Pradesh.
"It is struggling to survive by becoming the tail-ender in an alliance in these states," he added.
Jaitley said many in the Samajwadi Party were wondering if it is worth leaving 103 seats for the Congress in UP. "Is the Congress willing for an introspection as to why this is happening? Having denied to the Congress the position of being the ruling party, the electorate is now well on its way to deny it a role even as a principal opposition," he quipped.
Buoyed by BJP's performance in Maharashtra civic polls, the results of which were declared today, Jaitley said it shows the BJP is now capable of winning major states in its own right.
"The first message of these elections is the BJP has become a pan-India party which is now fast spreading its roots even in the eastern and southern states. The forthcoming election for the Karnataka assembly will reassert this," he asserted.