An Israeli law that takes effect on Monday limits cash payments in a business transaction to 6,000 new shekels ($1,785), as the country works to tackle organized crime, money laundering and tax evasion.
The law, which was introduced by the Israel Tax Authority last week, requires that any payment to a business of more than 6,000 shekels must be made by digital transfer or other means such as debit cards. Individuals who are not listed as business owners can access up to 15,000 shekels of cash in the business case, reports Xinhua news agency.
Previously, the maximum amount of cash that could be used in a business transaction was 11,000 shekels.
According to a statement issued by the Israel Tax Authority, the restriction on cash use does not apply to money transfers between family members, with the exception of payment of rent, for which the maximum amount has been reduced from 50,000 shekels to 15,000 shekels.
Analysts believe that the law will force people to pay through digital methods instead of cash so that transactions can be easily tracked. Cash payment limits are intended to curb tax evasion, black market activity and even terrorist actions.
Uri Goldman, an expert in international taxation, economic crime and money laundering prohibition, told Israeli media that the law primarily affects people such as plumbers and handymen, as well as small landlords.
He said that reducing the cash payment limit will have a significant impact on those who sell products like electrical goods and furniture.
Heavy fines are imposed for those who violate the law, starting at 15 percent for cash payments of less than 25,000 shekels, rising to 20 percent for payments of 25,000 to 50,000 shekels, and 30 for large payments. percent is reached. Israel Tax Authority.
Ultra-Orthodox Jewish charitable funds that give and receive money in cash are exempt from the law. Enforcement of the law does not currently apply to Israeli citizens giving or receiving cash to non-Israelis in the West Bank and the Gaza Strip and to non-Israeli residents in the two territories.
(Only the title and image in this report may have been reworked by Business Standard staff; the rest of the content is generated automatically from a syndicated feed.)
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