New Delhi : Consumers and merchants can look forward to a host of incentives such as fee waivers and tax benefits on cashless payments, for which a draft Cabinet note has been circulated by the Finance Ministry. The proposal would be presented before the Union Cabinet after Finance Ministry incorporates comments and suggestions made by various ministries and departments on the Draft that contains as many as 30 measures to encourage the e-payments.
The note has already incorporated the public feedback on a draft proposal for facilitating electronic transactions, which was put up in the public domain in June and suggestions were invited through the government’s MyGov.in platform.
It is proposed to provide income tax benefits to the persons paying a portion of their expenditure either through debit or credit cards and do away with transaction charges for purchase petrol, gas and rail tickets.
As per the proposal, all high value transactions exceeding Rs one lakh will have to be made through electronic mode and the utility service providers would be encouraged to give incentives for card payments. Incentives would also be given to shopkeepers accepting major portion of their payments through plastic money.
The proposal follows an announcement made by Finance Minister Arun Jaitley in his Budget speech, wherein he had said that one way to curb the flow of black money was to discourage transactions in cash. “Now that a majority of Indians have or can have a RUPAY debit card. I propose to introduce soon several measures that will incentivise credit or debit card transactions, and dis-incentivise cash transactions,” Jaitley had said.
Finance Ministry had in June put up for public comments the draft proposals for facilitating electronic transactions.
“Almost all the proposals mentioned in the draft have been incorporated in the Cabinet note. Besides, certain comments from public too have been included,” the source said.
As per the draft proposal, merchants could get a tax benefit for accepting 50% of payment in electronic mode. At present, there are about 57 crore debit cards and over 11 lakh point of sale (PoS) terminals in India.