Deputy chairman of Association of SME: Limiting cash will lead to greater tax evasion

Limiting cash will have the opposite effect to the one pursued by the government and will lead to greater tax evasion, businessman Feliciu Paraschiv, deputy chairman of the National Association of Small and Medium-sized Traders in Romania (ANCMMR) and member of Patronage of Small and Medium Enterprises in Vrancea, declared, on Monday."The IT system, the banking system is not prepared for this law. The clients are not prepared. There are elderly people who do not have the necessary skills and training to be able to work with an application on a mobile phone. The clients pay, against their will, a commission by opening a bank account. Traders pay an additional commission, against their will. The system is not secure, because bank fraud still exists, we constantly receive warnings not to open certain emails, not to act on emails from phishing and so on. Cash transactions are the safest. The system seen in this way is limiting, it limits some rights: my right to walk around with cash. As a conclusion, in my view, the system will increase tax evasion, because instead of people buying with 5,000 RON in cash, as they need for example, they will buy with 2,000 RON and they will buy the remaining 3,000 without an invoice. So it will lead to greater tax evasion," Feliciu Paraschiv told a press conference.The entrepreneur from Vrancea, who runs a company with over 400 employees and 17 places of business in the county, was of the opinion that the limitation of cash will also lead to an agglomeration at ATMs that allow cash deposits, especially since their number in the county is low compared to that of traders who will be obliged to deposit, within ten days, the money received in the bank."I think we should take an x-ray of the banking system from a few years ago. We raised an alarm signal four years ago when banks started to stop working with currency. It is a paradox, you, a foreign bank, to come to Romania and refuse to work with the country's currency. It is insulting. We raised this alarm signal, no one paid attention to us, and today the banks no longer work with the currency. For about a year and a half, banks have started not to work with banknotes either. They closed their cash counters. Not all, but more than half of the banks. For deposits, they send you outside to the MFMs, which allow cash deposits. And small traders are now obliged to go to these machines and deposit their money there. You can understand what it means to deposit 5,000 or 8,000 RON, in different denominations, the machine gives you the money back because it has a folded corner and so on. Until the capping, we have managed. Now, with the capping, we will see about 4,000 traders in Vrancea who have to deposit the money at a maximum of ten MFMs that are all over Vrancea. Everyone will gather there, those with small grocery stores, clothes, pet shops and all kinds of stores," said Paraschiv.He argued that all the costs of the banks' commissions will finally be found in the price of the products and will also be paid by the consumer.The president of the Association of Small and Medium Enterprises from Vrancea, Ion Roman, argued that, if the ceiling for cash is not raised, the members of the association he leads will go on a fiscal strike and refuse to pay the taxes owed to the state.Prime Minister Marcel Ciolacu met on Monday with the representatives of the Executive Council of the Romanian Association of Banks. On Friday, on Facebook, the Prime Minister announced that this week he will convene a meeting at the Government with specialists from the Ministry of Finance and the BNR, but also with representatives of small entrepreneurs, banks and civil society "to take a decision on the subject of cash money", noting that it is "intolerable" to "artificially" increase bank commissions.