Tax withdrawals above Rs 50,000: Chief Ministers' panel
Tax incentives for micro-ATMs mooted.
New Delhi: A Rs 1,000 subsidy for purchase of smartphones by non-tax assesses and small merchants and a cash transaction tax on withdrawals of Rs 50,000 and above in banks have been recommended by a Chief Ministers’ panel on Tuesday to encourage digital payments.
The panel on cashless transactions headed by Andhra Pradesh Chief Minister N. Chandrababu Naidu has also suggested in its report that tax incentives should be extended to micro-ATMs and biometric sensors and their domestic production should be encouraged. There is a strong possibility that these recommendations may find a place in the forthcoming Union Budget.
In fact, to curb use of cash for large transactions, the panel has recommended levy of a banking cash transaction tax on transactions of Rs 50,000 and above. It has called for consideration of a cap on maximum allowable limit of cash in all types of large ticket size transactions.
The panel has further suggested that all government sections like insurance, educational institutes, fertilisers, PDS and petroleum etc should switch to digital payments system.
The committee, which was formed by Prime Minister Narendra Modi on November 30 last year, has also advocated relief in prospective taxes for encouraging merchants to accept digital payments.
It has further suggested that no retrospective taxation should be levied on merchants indulging in digital transactions.