Economy

Cashless Transactions: Modi Government Attempts To Boost With Tax Cuts

Cashless Transactions Modi

As of now, we know that for all the transactions, we pay 15% of the total amount. From the time Narendra Modi came into office, he took lots of steps in order to make India digital and Cashless. Several schemes and plans have been implemented in order to achieve the same. One more step, currently taken by Narendra Modi is being discussed in news, which we are here to talk about. Let us look into this in a bit more detail.

  • Cashless Transactions: No Service tax Up to Rs. 2000:

From today on wards, it is announced that there will be no service tax charged on any transactions, if we pay using credit or debit card. This is one of the many steps taken by the government to encourage the card payments. It is announced today that up to Rs. 2000, no service tax will be levied. From this news coming up, it is very clear that the government wants to make a move the transactions from cash to digital.

This tax break news for the use of credit/debit cards, came out exactly one month after the honorable Prime Minister proclaimed the demonetization It was just a few weeks ago only, that the RBI doubled the allowable balance to be kept in prepaid wallets. It was increased from Rs. 10000, to Rs. 20000. These series of steps taken by the government is only aimed to increase the Indian economy, as well as make India digital. This notification, which is held to be tabled today, seeks to amend a 2012 notification.

  • Will this Step Can Help Digitize India?

There is no doubt that this step is taken to help India Digitize. But the question here arises is, “Will This Step Really Help In Making India Digital?”. From my point of view, this step could have been more successful if there would have been no limit on the transaction.

The limit of Rs. 2000 for the service to be free, is a bit obstacle for making this step to help India digitize. The RBI also announced that there will be an option for the user whether they want to go through the two factor authentication or not. This means that the users can opt out of providing an OTP, that is a one time password, for such small transactions.

Prime Minister Narendra Modi has sought people’s support for making India Digital as well as cashless, in his monthly Mann Ki Bat program. He has also urged all the traders and farmers to start using digital modes of transaction. This will definitely help India get transformed and will further help the Indian economy to grow as well.

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