Portuguese MPs have ignored the opinion of the European Central Bank and will press ahead this week with the law to limit cash payment to €3,000.
The bill was submitted to the European Central Bank for an opinion. The response criticized the initiative, suggesting that it should be scrapped.
This advice clearly was not what MPs wanted to hear and the cash restriction should pass through parliament on Wednesday, July 20th.
The proposal was presented in April 2016, following the Panama Papers scandal but only came up for approval this week.
This limit prohibits cash payments of more than €3,000 in payment for goods and services, and loans.
The bill exempts those foreigners who are not traders or businessmen - in their case, the maximum payment in cash can be €10,000, unless the payment is a tax bill, in which case the cash limit is €500 for everyone.
The European Central bank identified several technical shortcomings and questioned the effectiveness of the proposed measure, arguing that these rules are not really an impediment to large illicit cash payments and that anyway, such limitations can be viewed as discriminatory.
The Social Democrats wanted the cash limit raised to €10,000, but this was rejected. After Wednesday’s vote, if successful, the approved law will go to the president’s office for approval or rejection.
