The Effect of a cashless policy on Tax Revenue

[Yakub02]

During the period of cashless implementations, it would always go with one effect or the other as far as tax management is concerned.

The under listed are discussed as part of manifestation of Tax revenue in amidst cashless policy.

-INCREASED TRANSPARENCY - With a cashless system, it becomes easier for tax authorities to track financial transactions and identify sources of income. This can help in reducing tax evasion and increasing tax revenue.

-RESISTANCE FROM CASH-DEPENDENT BUSINESSES AND INDIVIDUALS - The transition to a cashless system can be difficult for some businesses and individuals who are used to dealing in cash. This can lead to resistance and non-compliance with the new system, affecting tax revenue.

-WIDER TAX NET- A cashless system can help in expanding the tax net by bringing more people and businesses into the formal economy. This can lead to increased tax revenue for the government.

-IMPLEMENTATION COST- Implementing a cashless system can be expensive, both in terms of technological infrastructure and administrative costs. This can have a negative impact on tax revenue in the short term.

-IMPROVED COMPLIANCE- A cashless system can help improve compliance with tax laws and regulations by making it easier for taxpayers to report and pay taxes electronically.

-CYBER SECURITY RISK - A cashless system is vulnerable to cybersecurity threats, such as hacking, identity theft, and fraud. This can result in loss of tax revenue if sensitive financial information is compromised.

 

[Yakub02]

Tax management crucial component of overall economic policy affecting government, businesses and individuals .

Tax management is a critical aspect of any modern economy, as it affects not only the government but also businesses and individuals. It plays a vital role in ensuring the stability and sustainability of the economy, and is a key factor in the government's ability to provide public goods and services to citizens. The impact of tax policy on businesses and individuals ranges from the cost of compliance to the level of tax burden, which in turn affects their ability to invest and grow. Effective tax management is crucial to the overall economic performance of a country, as it helps to balance the budget and to allocate resources effectively. In order to achieve these goals, it is important to have a well-designed tax system that is transparent, simple, and equitable, and that promotes economic growth and competitiveness.

Tax management is a very important concept that cuts across all aspect of National economy. A well designed tax system will not only help the government to have a good focus but also make the citizens to have a good trust in the administration of the state.

Business will thrive and business men will be transparent in their account preparation when they have assurance that there would value for tax paid to the government purse,

 

[Ekta]

In recent years, the policy of going cashless has been adopted by more and more countries, in order to reduce tax evasion, simplify the payment system, and increase transparency. The cashless policy has had a positive effect on the tax revenue by increasing the amount of taxes collected.

First of all, a cashless system eliminates the possibility of paying taxes in cash, which was a major source of tax evasion. This has resulted in more people paying their taxes, which has increased the amount of taxes collected. It also simplifies the payment process, making it easier for people to pay their taxes. This increases the number of people who are willing and able to pay their taxes, resulting increase in the amount of taxes collected.

The cashless system also increases transparency. by reducing the number of cash transactions, it is easier for government to track the flow of money and identify those who are envading taxes. This makes it easier for them to collect the taxes that are owed, resulting in an increase in tax revenue.