News out of Belgium this week indicates the Economic Inspectorate will be clamping down on vendors who accept cash for payment. According to the Economic Inspectorate, Chantal De Pauw the upper limit on cash payment has been lowered to 3,000 (Euros). De Pauw continued, “Of course checks need to be made to ensure that the rules are being enforced.”
If you planned to purchase your car using cash you had better think again unless the ticket price is 3,000 or less. Wish to buy a new washer and dryer? Same limits apply with the 3,000 Euro cash maximum. In order to insure these limits are being followed the checks on cash limits has been said to have increased from 70 to nearly 700 over the past two years.
When the law initially went into effect under Article 21 of the Law a merchant could receive up to 10% but not more than 15,000 Euro for the price of goods or services in cash. The amount has since been lowered to the aforementioned 3,000. According to the Financial Action Task Force on Money Laundering (FATF) these limits are necessary to prevent fraud and tax evasion. Further, if you are caught paying more than the limit allowed in cash you are subject to a fine of 250 Euro to 225,000 Euro (The fine shall not exceed 10% of the overpaid cash amount).
My favorite part of this story is this section 1.2.2 “The King will identify in a Royal Decree the list of merchants and service providers who must inform the Financial Information Processing Unit of any case of breach of the cash limitation.” So thankful we do not live under the rule of a King…oh wait, Emperor Obama is not much different.
The European Central Bank (ECB) wanted to clarify why this limit was put in place and explain the justification for such an imposition. They state, “The ECB understands that a) lawful means for the settlement of monetary debts, other than cash, are available to Belgium; and b) the draft law’s objectives of combating tax fraud and curbing of theft of copper (Yes, I said theft of copper) qualify as public reasons OUTWEIGHING the impact of the limitations on cash payments.”
If you have wondered what conditions might be used as an excuse to limit or restrict the use of cash in the United States…Belgium makes an interesting test case. There have been individual cases where merchants refused to take cash from customers…airlines are the most recent groups to refuse you cash aboard flight. Want to buy a snack…you had better have plastic because they do not take your paper money!
Back in 2007, Apple announced they would no longer accept cash for the purchase of their beloved iPhones. The controversy made headlines later in 2010 when a customer in California attempted to purchase an Apple product with cash…the woman was told no thank you, we don’t want your money unless it’s in plastic form. Even though she had saved all $600 to purchase the iPad, she left the store empty handed.
The move towards a cashless society has made rapid gains around the globe…soon you will be unable to buy or sell anything using your hard earned cash…unless it’s first transformed into plastic. The credit card companies and banks must love this plan because with their current high interest rates on even those of us with excellent credit…they are soon set to be a monopoly in everything we purchase…good or service.
Many of these companies claim credit cards and debit cards offer more protection than cash…yet recent stories show this may not be the case. Identity theft was once something that occurred when thieves rummaged through your trash can to find discard documents containing your personal information. No more! Now they hack your computer or your banks computer or even a government department’s computer and steal directly from your account.
In addition, cash provides a level of anonymity about who you are, where you are, and what you purchase. Once you are forced to use plastic there is always a paper trail or even a digital trail that leaves you exposed. Privacy goes out the window with the cash.
This doesn’t seem to have much of an impact on American thinking. According to a recent poll nearly 50% of Americans carry less than $20 in their wallet each day and almost 10% carry none at all. It makes one wonder if anyone will notice when the day comes that cash is no longer King and has actually been banned from the kingdom!