Authorities in Israel on Monday imposed further restrictions on cash payments as a means of fighting illegal activities and encouraging digital payments in the country.
Since January 2019, Israeli businesses and consumers have been subject to cash payment limits under the Cash Reduction Act. It aims to shift the country’s citizens and businesses to digital payments, making it easier for authorities to track tax evasion, black market activity and money laundering.
As of August 1, cash payment limits have been tightened to 6,000 Israeli Shekels (NIS), equivalent to $1,760 US dollars (USD) for business transactions and NIS 15,000 ($4,400 USD) for personal transactions.
Further restrictions are expected to follow in the future, prohibiting stockpiling of more than 200,000 shekels (USD 58,660) in private homes over NIS $200,000.
Tamar Bracha, who is reportedly responsible for implementing the law on behalf of the Israel Tax Agency (ITA), recently told Media Line that restricting the use of cash will increase the difficulty of criminal activity, stating:
“The goal is to reduce the liquidity of cash in the market, especially since crime organizations tend to rely on cash.”
Meanwhile, the new limits on hard cash transactions are seen by some as a good sign for future crypto adoption in the country.
On July 30, Crypto influencer Lark Davis told his 1 million followers on Twitter that Israel is neither the first nor the last country to introduce such restrictions, and took the opportunity to reference Bitcoin in his post.