Govt now wants to cap cash transactions at Rs 2 lakh
Any payment over Rs 2 lakh will now be taxed at a 100 per cent. Photograph: (AFP)
To push digital transactions in India, finance minister Arun Jaitley had in his budget said the government would penalise any cash transaction above Rs 3 lakh.
The government now wants to push that limit down to Rs 2 lakh.
Govt has proposed that limit of Rs 3 lakhs for cash transaction beyond which it is illegal, be reduced to Rs 2 lakhs: H Adhia, Revenue Secy pic.twitter.com/EnJQFJSgJl— ANI (@ANI_news) March 21, 2017
Any cash payment over that will now be taxed at a 100 per cent.
The announcement was made by revenue secretary Hasmukh Adhia.
Adhia, a Gujarati, was at the time identified by media reports as having worked out the modalities of the demonetisation rollout.
The government had said that demonetisation, announced by Prime Minister Modi on November 8, had, among other things, been meant to push digital payments.
It is Prime Minister Modi's belief that cash is expensive -- he has said so in speeches -- and that moving to digital payments will help India modernise faster.