Banking Cash Transaction Tax

In the year 2005, The Finance Act led to the introduction of a novel levy which is known as the Banking Cash Transaction Tax. This can also be explained as BCTT. Here, as we move forward, we shall be discussing BCTT in detail along with the return of taxable banking cash transactions and securities transactions in India.

BCTT – Tax Base

The tax base for the goal of BCTT can be taxable banking transactions’ value. As per clause (8) of section 94 with regards to 2005, Finance Act, the definition of a taxable banking transaction can be understood. The transactions can be mainly divided into two separate categories such as cash withdrawal as well as the receipt of cash once the encashment of term credits have been completed. 

It may be inferred that the kind of tax charged when there is the withdrawal of cash which exceeds the particular limit as per the bank, is the one which is known as the banking cash transaction tax, that is, BCTT. In the year 2005 this banking cash transaction tax was first presented by the United Progressive Alliance. It should be noted that in Jammu and Kashmir, one could not apply banking cash transaction tax.

For falling into the domain of taxable banking transactions, the cash withdrawal can have to satisfy certain conditions such as the withdrawal of cash being from a different account than the one which is a savings account. Further, with any scheduled bank, the amount should be continued. The last condition can be the value of money that is taken out from the same account on one day ought to be more than Rupees twenty-five thousand when it is regarding a person or HUF or a sum of one lakh in case of some other person. Similarly, even the receipt of cash once the encashment of term credits should be able to satisfy certain conditions. 

Apart from all these points, it can be noted that the total measure of the taxable banking transactions ought to be the value of money taken out or the amount of money that is received on a term deposits’ encashment, depending on the case, on any particular day. 

Securities Transaction Tax

In this section, we shall focus on the securities transaction tax which can be understood as a sort of financial transaction tax. This can be called being comparable to the tax collected at the source. One can say that the direct tax which is imposed on the sale and purchase of securities that are there on India’s stock exchange can be called the securities transaction tax. This tax is administered by the Securities Transaction Tax Act. However, it may be noted that in this Act, the meaning of securities is not specified or defined. 

Conclusion

As observed from the above section, one can clearly understand the Banking Cash Transaction Tax, Return of taxable banking cash transactions and the securities transaction tax in India. All these vary from one another in terms of their meaning, the Acts which introduced them and various other aspects which have been discussed above. Thus, it can be concluded that the above sections helped in gaining knowledge about the Banking Cash Transaction Tax, Return of taxable banking cash transactions and the securities transaction tax.