Australians who hand over $ 10,000 in cash to buy a dealer's car will soon be in jail for two years.
In a confusing development, the government will still allow consumers to hand in an unlimited amount of banknotes if they buy a second-hand car privately.
However, buying a used car from a dealer will be a different matter from January 2020.
Those who violate the proposed law will receive a fine of $ 25,200 or be imprisoned for two years.
Australians handing over $ 10,000 in cash to buy a dealer's car will soon be in jail for two years (pictured is a Melbourne Toyota dealer)
The confusion about the proposed law has angry economist John Adams who described it as & # 39; draconian & # 39; and an insult to personal freedom.
& # 39; To bring this law, you take freedom away & # 39 ;, he told Martin North, head of Digital Finance Analytics, in a video chat.
Assistant treasurer Michael Sukkar introduced a bill to Parliament last week explaining the $ 10,000 cash transaction ban.
He explained that consumers could still buy a car in cash, provided that this was done through a private buyer.
& # 39; Importantly, the cash payment limit does not apply to private transactions with the exception of real estate transactions – for example, the sale of a private car to another person, & # 39; he said to the House of Representatives.
His spokesperson told Daily Mail Australia that it is illegal under the proposed law to hand over $ 10,000 in cash to buy a vehicle from a used car dealer.
& # 39; For example, if you choose to sell a personal property to a private individual, such as a $ 15,000 car, you can still do so in cash, & # 39; he said.
& # 39; However, if you were to buy a car from a car dealer, you would not be able to pay $ 10,000 or more of the balance in cash. & # 39;
In a confusing development, the government will still allow consumers to hand over an unlimited amount of banknotes when they purchase a second-hand car privately
The government has admitted that it does not know how much this new law will yield, given the promise to crackdown on the black market.
An explanatory note that was distributed in the Lower House admitted that it had the & # 39; financial impact & # 39; in the next three years.
& # 39; The account has an estimated non-quantifiable effect on sales above forward estimates, & # 39; it said.
Mr. Adams said that the cost of introducing a new law criminalizing $ 10,000 cash transactions was not justified as it would involve expensive surveillance.
& # 39; They say we don't know how much income we're going to generate, & # 39; he said.
& # 39; That is a major problem in a cost-benefit analysis.
& # 39; Even before we leave the gate, the government says: & # 39; We're going to spend money to enforce this draconian law, but we don't know how much integrity the system will bring, how much extra tax we can get. "
Assistant treasurer Michael Sukkar introduced a bill to Parliament last week explaining the $ 10,000 cash transaction ban. He explained that consumers could still buy a car in cash, provided that this was done through a private buyer
The $ 10,000 cash ban applies to individuals and businesses that have made or accepted banknote payments.
Australians can still deposit and withdraw $ 10,000 at the bank and save how they want.
Mr. Sukkar said that most daily transactions in Australia are unlikely to exceed this limit.
"We are living in a time when a large majority of companies are now conducting transactions through electronic payment methods, reducing their costs for storing, transporting, losing and monitoring cash," he said.
He said the law was about tackling criminal activities.
& # 39; The government is sending a strong message to the community, and, more importantly, that the use of cash to avoid obligations and possibly engage in criminal activities is a serious matter that requires sufficient deterrence, & # 39; he said.
In another bit of confusion, the government hinted that digital and crypo currencies could be exempted from the $ 10,000 cash ban.
& # 39; Although digital currency is included in the definition of cash, given the ways in which digital currency is currently being used in Australia, the treasurer is expected to exempt most digital currency transactions from the cash payment limit, & # 39; said the exposure setup.
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