The $10k cash call: Why large payments are on the scrapheap
Opposition is mounting against a federal government bill to ban cash payments over $10,000 with concerns it will push customers into the clutches of banks or other financial institutions.
The Currency (Restrictions on the Use of Cash) Bill 2019, which passed through the House of Representatives on Thursday, is designed to crack down on criminal money laundering.
"We know that large amounts of cash are essential to the business model of criminal gangs," says Assistant Treasurer Michael Sukkar.
"These gangs launder the cash from the proceeds of manufacturing and selling drugs and other serious crimes through the legitimate economy. The cash limit will make it harder for them to do so."
On Thursday, Labor's shadow assistant treasurer Stephen Jones pushed for an amendment to the bill that "recognises the importance of cash for conducting transactions around Australia", following "a lot of concern within the community about the impact of this bill".
Independent MP Andrew Wilkie flagged concerns the measure will push customers into the banking system, especially given the impending threat of negative interest rates.
"An interesting line of argument, which I think has some merit, is: if Australia does eventually reach negative interest rates, cash will assume new importance, but this bill will diminish the ability of people to use cash," Wilkie said.
The move has also copped heat from lobby groups, including the Australian Chamber of Commerce and Industry (ACCI) and CPA Australia.
Amanda Cassar of Wealth Planning Partners believes the concerns are overblown.
"For the most part, people now take advantage of online and phone banking services" but acknowledged "the fine and possible jail sentence for innocent people who still have a preference to use cash."
In the same vein, Finn Dorney of Shadforth Financial Group says "a move to reduce the amount of cash transactions over time will only benefit Australians. However, whilst there is no argument that some cash transactions can be linked with criminal behaviour, this does not account for all transactions of this type, and therefore careful consideration would need to be given to the implementation of such an extreme change in legislation."