From Jan 1, PAN mandatory for transactions above Rs 2 lakh
A bid to curtail domestic black money flow, the finance ministry on Tuesday announced mandatory furnishing of permanent account number (PAN) for all transactions above Rs 2 lakh through all payment modes with effect from January 1, 2016. This is a relaxation from an proposal to make PAN mandatory for sale and purchase of items above Rs 1 lakh.
Besides, the ministry rationalised monetary limits for certain transactions requiring mandatory quoting of PAN. The monetary limits for sale or purchase of immovable property has been raised from Rs 5 lakh to Rs 10 lakh, and that for hotel / restaurant bills raised from Rs 25,000 to Rs 50,000. Sale or purchase of shares of an unlisted company has been raised from Rs 50,000 to Rs 1 lakh.
In line with the government's thrust on financial inclusion, opening of a no-frills bank account such as Jan Dhan will not require PAN. The requirement of PAN applies to opening of all bank accounts including in co-operative banks .Installation of cellphone and telephone connections will not require quotation of PAN anymore.In a Facebook post in October, finance minister Arun Jaitley had said that a bulk of black money was still within India, and there was a need to change the national attitude so that plastic currency becomes the norm and cash an exception. "The government is working with various authorities to incentivise this change," he had said.
In line with the government's thrust on financial inclusion, opening of a no-frills bank account such as Jan Dhan will not require PAN. The requirement of PAN applies to opening of all bank accounts including in co-operative banks .Installation of cellphone and telephone connections will not require quotation of PAN anymore.In a Facebook post in October, finance minister Arun Jaitley had said that a bulk of black money was still within India, and there was a need to change the national attitude so that plastic currency becomes the norm and cash an exception. "The government is working with various authorities to incentivise this change," he had said.
"We have received a lot of representations. We will give breathing time to taxpayers," said revenue secretary Hasmukh Adhia.
Accepting the recommendations of the special investigation team on black money, finance minister Arun Jaitley had in the 2015-16 Budget proposed to make PAN details mandatory for all sale and purchase of Rs 1 lakh and above. However, it met with resistance from trade and industry associations that argued the lower limit would affect business.
"The government has received numerous representations from various quarters regarding the burden of compliance this proposal will entail. Considering the representations, PAN will be required for transactions of an amount exceeding Rs 2 lakh regardless of the mode of payment," Central Board of Direct Taxes (CBDT) said in a statement on Tuesday.
No comments: