Important recommendation of Chandrababu Naidu led CMs panel on digital economy is imposing tax on cash withdrawals above Rs. 50000. The committee has also urged the government to abolish Merchant Discount Rate, and extend incentives to micro ATMs.
Committee on digital payments under the leadership of AP Chief Minister N Chandrababu Naidu submitted its interim report to PM Narendra Modi on 24th January 2017.
The committee has also expressed opinion that the incentives should be extended to micro ATMs. It has also suggested insurance cover to mobile payments. Other recommendations include:
1) Rs. 1000 concession should be given to purchase of smart phones and biometric machines for those who does not comes under the purview of income tax.
2) All banks should take steps to link the accounts with Aadhaar by 31st March 2017 to make Aadhaar linked payments.
3) 100 MB free data should be given to people who make mobile payments.
4) Taxes on digital payments to Government services should be reducfe3d drastically or waived completely.
5) There should be an upper limit on the cash component in the transactions related to purchase of properties, motor vehicles and luxury goods.
6) Business Correspondents should be offered fixed salary irrespective of transactions. Their commissions have to be excluded from TDS.