New Delhi: Finance Minister Nirmala Sitharaman today announced that a 2% Tax Deduction at Source (TDS) would be levied on cash withdrawals of over Rs 1 crore.
She said that the move was aimed at discouraging the practice of making business payments in cash.
In other words, TDS would help curb the propensity of fueling a parallel black market economy.
Prime Minister has been encouraging electronic payments for all transactions including for daily and small activities.
Besides this move, which would primarily be aimed at the richer segment of society, the FM also proposed a surcharge of 3% on incomes between Rs 2-5 crore per annum. And a 7% surcharge on incomes over Rs 5 crore.
No income tax would be charged to those whose income does not exceed Rs 5 lakh per annum.
