NEW DELHI: The Government of India has today, proposed a draft bill comprising of certain possible incentives to increase the plastic transactions i.e., payments through Credit or Debit cards. In a bid to increase the use of the Debit cards, the Government has today proposed income tax benefits for people making payments through cards. The Government has also drafted rules, to do away with the transaction charges on the purchase of Gas, Petrol and Rail tickets using plastic money.
The Government in its draft paper towards a cashless economy, has proposed that the transactions which amounts over one lakh rupees must be made through electronic mode only. Thus, making it mandatory to use electronic transactions for higher amounts. The Government agencies believe that the new rule would help the authorities to monitor tax avoidance.
The draft bill proposed for a tax rebate on the shopkeepers provided that the Point of sale accepts a significant amount of transactions through plastic money. “The proposals in the draft bill are aimed at increasing the use of electronic payments by individuals which in turn helps the Government in countering tax avoidance and counterfeiting of currency”, an Economic analyst said.
The draft has also considered providing consumers with income tax benefits, if he or she uses plastic money for the majority of the individual transactions. The Government has invited comments on the draft bill till June, 29th.
Earlier, the Union Finance Minister Mr.Arun Jaitley, has said in the Budget speech that the Government will come up with several measures to increase the use of electronic transactions and decrease the use of cash transactions. Accordingly, the draft proposed to remove the fees on various e-transactions offered by different entities.
The draft proposed for a change in the norms ordering the requirement of the banks, to send the transaction details of the individuals crossing his or her credit card use with over Rs.2 lakhs. The bill said that the transactions limit must be raised to 5 lakhs or more, The Huffingtonpost reports.
It also advised that the Government must enable a proper e-payments infrastructure for the payments and collection of revenue and penalties through out the country. At present the Indian sub-continent consists of 56.4 crore debit cards and 11.25 lakh point of sale (PoS) terminals.