A draft law on cash regulation has been submitted for public consultation

On Tuesday, August 20th, the Ministry of Finance (MF) submitted a draft law titled "Amendments to the Law on Taxes and Fees" for public consultation on the Legal Acts Drafts Portal. These amendments are designed to more effectively monitor cash circulation and promote the use of cashless payments in transactions. The amendments introduce several significant changes and were prepared as part of the measures included in the Shadow Economy Limitation Plan for 2024–2027.

The amendments delegate to the Cabinet of Ministers the authority to determine cases where entities subject to the Law on the Prevention of Money Laundering and Terrorism and Proliferation Financing are required to submit a threshold declaration to the State Revenue Service (VID) using the Financial Intelligence Service’s receipt and analysis system. Currently, the Law on Taxes and Fees specifies only one particular entity and case where a threshold declaration must be submitted to the VID using the Financial Intelligence Service's receipt and analysis system. In the future, the State Revenue Service will receive information about cash transactions exceeding 750 EUR.

Additionally, the proposed amendments stipulate that banks and service providers will be required to report to the VID once a year on cash transactions of their clients—individuals—if their total annual amount exceeds 7,000 euros. Currently, the VID receives information on individuals whose account turnover for the previous year exceeds 15,000 euros. Consequently, information on cash deposits, combined with the existing data provided by banks and payment service providers, will enable more effective identification and timely prevention of tax evasion risks.

Furthermore, for taxpayers with an annual turnover exceeding 50,000 euros, the amendments to the law require them to provide customers with the option to make payments for services and retail transactions also in a cashless form.

The current regulations stipulate that taxpayers in wholesale trade must only conduct cashless transactions, including payments by card. According to the Law on Taxes and Fees, wholesale trade is defined as the sale of purchased goods in the name of the economic operator for resale, production, or ensuring its own activities. Therefore, the proposed regulation will affect service providers and retailers who will be required, in addition to existing cash payments, to offer customers the option to pay by cashless means.

The draft law is available for review on the Legal Acts Drafts Portal.