Card payment may become mandatory for 5-star hotel bills

Finance Minister Arun Jaitley in the Union Budget 2015-16 has hinted at curbing the black money menace, which has recently become a political issue. Working on the proposal, the government is planning to make high value transactions cash free. As per a PTI report, the central government is considering to make the use of cards mandatory for paying bills in 5-star hotels.

Paying hotel bills beyond certain limits through debit or credit card would enable the government to keep a track on an individual’s spending. This process is followed by many European countries for the same reason.

An ET report revealed that Jaitley, as per Special Investigative Team’s (SIT) suggestion on black money, wants to incentivise credit and debit card transactions and discourage cash transactions for high value payments.

"Several things are under consideration, for example incentivising banks ... you know there are transaction costs which government can perhaps share. But there are also otherwise, you know what I would say to disincentivise cash transaction, any expenditure by a person in a five star hotel above Rs 5,000 have to be settled using credit card, there can be also decisions like that," finance secretary Rajiv Mehrishi said while addressing a press meet.

The Modi government has formed a committee to encourage credit and debit card transactions in order to tame black money flow in the country.

While SIT’s suggestions also include confiscation of cash by private individual beyond certain limit, it has also asked the government to ensure that small cash transactions made by mass don’t get affected in this process.

(Image: Reuters)