Budget could make PAN compulsory for cash deals as low as Rs 30,000

In order to ensure that cash-based transactions in the country come down sharply over a period of time, the government has been pushing hard with several of its initiatives over the past one month or so. Besides, giving a leg up to digital-based payment transactions, the Narendra Modi government has been planning to use this budget to disincentives people from engaging in more cash-based transactions.

One such measure the government is looking at is bringing down threshold required for quoting the PAN card for cash transactions, said a report The Economic Times.

Currently, any cash transaction of Rs 50,000 and above require a person to quote his PAN card number. If the proposal in this budget fructifies, an individual making cash transaction of Rs 30,000 and above will have to quote his PAN card details.

 Budget could make PAN compulsory for cash deals as low as Rs 30,000

PAN card. Image courtesy :CNN-IBN

The recommendation to quote PAN card details for even lower amounts could deter individuals from undertaking cash-based transactions, and hence put the spotlight back on digital-based transactions.

"In addition to these steps, the government may also announce cash-handling charges for cash payments above a certain limit," the ET report said.

Further, to discourage cash usage in merchant transactions, threshold for quoting PAN card details could be brought down from the existing Rs 2 lakh. In fact, a plan is in the works to levy charge on cash transactions above Rs 1 lakh.

There is a growing concern that with easing cash withdrawal situation at both banks and ATMs across the country, people would be tempted to go back to using cash in a big way, thus defeating the purpose of dmonetisation.

Earlier this week, a report also suggested that the government could look at a proposal to further limit the number of free withdrawals from the ATMs to just three per month from the prevailing 8-10 transactions.

For full coverage of Union Budget 2017, click here

Your guide to the latest cricket World Cup stories, analysis, reports, opinions, live updates and scores on https://www.firstpost.com/firstcricket/series/icc-cricket-world-cup-2019.html. Follow us on Twitter and Instagram or like our Facebook page for updates throughout the ongoing event in England and Wales.

Updated Date: Jan 19, 2017 15:57:52 IST