
Australian government proposes to limit cash payments for purchases to AUD$10K - Mononokay
https://www.theguardian.com/australia-news/2018/may/08/australia-federal-budget-2018-cash-payment-crackdown-tax-evasion
======
walterbell
From [https://www.cato.org/cato-journal/springsummer-2018/curse-
wa...](https://www.cato.org/cato-journal/springsummer-2018/curse-war-cash)

 _" The phrase “war on cash” suggests a parallel to the “war on drugs” and
aptly so. In both wars, traditional civil liberties are shunted aside in the
criminalization, surveillance, and prosecution of victimless private
activities

... The war on cash might be more accurately labelled the “war on people who
use cash.” What are suppressed by the above-listed tactics are not inanimate
objects but people. Cash itself experiences no harms. People do. Coercive
anti-cash policies abridge the freedom and reduce the welfare of peaceful
individuals who prefer to use cash.

... The war on cash is being waged for the exclusive benefit of those who
already wield an inordinate amount of power and control over the economy and
the people that are struggling in it. And they want more. By slowly, quietly
killing cash, they seek to seize the last remaining thing that offers people a
small semblance of privacy, anonymity, and personal freedom in their
increasingly controlled and surveyed lives."_

~~~
komali2
>The war on cash is being waged for the exclusive benefit of those who already
wield an inordinate amount of power and control over the economy

Yup, this article tickled a deeply buried "sovereign citizen" type personality
I didn't even know I had.

So without cash your options are write a check, which means you have to give
your money to a bank, or use a credit card, which means you have to give your
money to a bank.

Americans learned in 2008 exactly how much power banks have.

I'm reading a fantastic book right now titled "Walkaway." It takes place in a
near-future where solar and hydrogen energy are robust and cost effective
enough that, when combined with raw material feedstock, can be plugged into 3d
printers to make pretty much anything you've got drawings for. Combined with
an open source CAD community and UN refugee resources, it opens the
opportunity for people to simply walk away from civilization, print up
shelters, and build anarchist communities that refuse to even use popularity
as a form of currency. It's a fun idea to chew over - post scarcity, why not
just walk away?

~~~
yongjik
> It takes place in a near-future where solar and hydrogen energy are robust
> and cost effective enough (...)

As of now, each bit of solar/hydrogen/etc. energy technology requires raw
materials mined from around the globe, processed in factories around the
world, and assembled in some other corner of the world: the number of people
that made it possible could easily add up to millions. And these people are
doing it to make money: there's no incentive to make the technology suitable
for someone who's planning to get lost in a forest and stop paying.

In short, I don't think these technology will allow you to "walk away" any
more than an iPhone can.

~~~
walterbell
Each new generation of tech requires a freedom/liberation myth to harness the
energy of a new generation of humans, until the time comes to pull Tim Wu’s
“master switch” and reboot onto a new substrate of emerging tech and youth.

------
avar
Aside from the "war on cash" angle covered in other comments, setting these
types of limits to an arbitrary dollar amount is fundamentally unjust.

The CTR limit of $10K in the US is well known, but when it was introduced in
the 70s[1] $10K was the equivalent of around $65K in today's money.

Similarly, inflation will guarantee if this is enacted Australians won't be
able to buy something like a phone, fridge or a laptop in a few decades due to
the relentless progress of inflation.

A few decades after that they won't be able to buy their groceries for $10K.
These types of laws effectively outlaw cash entirely, they just have a time
delay until they come into full effect.

1\.
[https://repositorio.comillas.edu/rest/bitstreams/38908/retri...](https://repositorio.comillas.edu/rest/bitstreams/38908/retrieve)

~~~
zwily
I think that’s the point. Governments would prefer cash just didn’t exist.

~~~
InitialLastName
Interestingly, governments also make money on cash existing; every moment's
inflation that isn't realized by that cash is money in the government's
pocket.

~~~
helianer
They will, of course, make their seinorage whether they are physical
notes/coins, or added to the money supply via some bits on a disk.

------
pmontra
Italy has a limit of 3,000 Euro for cash payments. There is a table with the
limits since the early '90s at [https://www.codiceazienda.it/limite-contanti-
tabella-riepilo...](https://www.codiceazienda.it/limite-contanti-tabella-
riepilogativa/) (reference to the law, dd/mm/yyyy, limit.) The first one is in
Liras, about 10k Euro.

My feeling is that it did little to achieve the desired result at least about
money laundering. Apparently there are so many other ways to do that. For
lawful expenses, checks (almost obsolete), bank transfers or credit cards are
more convenient than getting cash at an ATM.

~~~
jaclaz
To be picky, and as specified in the link, it has _now_ (since 2016) a 3,000
Euro limit for cash payments, it had (and it was "pure folly" in practice) a
limit of only 1,000 Euro in 2012-2015.

JFYI, I remember that circa 2013 I had to make a particular payment to a
Government Administration (only possible via the Post Office - Bollettino
Postale) of around 1,200 Euro.

The Post Office wouldn't accept cash or a credit card, only a particular kind
of cheque (Assegno Circolare) emitted directly from my bank.

Of course this check had to be printed and the bank software had a limited
printing length field for the payee, which was an extremely long name.

The Post Office wouldn't accept any abbreviation/acronym, I went back and
forth several times between bank and Post Office until finally a bank director
came out with a key that allowed to print the cheque in a "condensed" font.

------
michaelmrose
Some while back a bank ceo floated the idea of negative interest rates for
consumer deposits. Not negative as in less than inflation but literally
negative.

If banks are allowed to kill the utility of transacting business with cash I
would fully expect the amount of money sucked out of the economy by the
banking sector to increase in fees to hold and transfer money.

Cash transaction are a hard break on how asinine you can be without your
customers deciding to do business with nobody.

------
Canada
So, no more paying for things in Australia with more than $7500 USD? Brutal.
Pretty soon it won't be legal to even pay your rent with cash.

As far as I know various $10,000 reporting laws started in the 1970s. That's
more than $60,000 in today's money. Have these limits ever been adjusted for
inflation in any country?

~~~
Rebelgecko
I think in the US the limit actually went lower. At the very least, multiple
$9k transactions set off some flags

~~~
fomojola
That's just the structuring detection: the limit is $10000 but most financial
institutions have some form of check for structuring or smurfing (see
[https://en.wikipedia.org/wiki/Structuring](https://en.wikipedia.org/wiki/Structuring)).
One payment under the limit probably won't trigger it, but multiple will.
Every couple of years there is a story about some small business owner who
draws the ire of some government agency because they make multiple deposits
under 10k.

------
balabaster
Is this a bid by Credit Card companies to force everyone to pay them, or so
that when you step out of line they can control you by controlling your access
to resources?

Either way, impeding your ability to purchase things in any manner you (and
your vendor or customer) see fit isn't okay by me.

~~~
tdb7893
It's to stop black markets. There are very few legitimate cash transactions
over 10k as few people have that much in cash and cash transactions that big
are very cumbersome.

~~~
nasalgoat
I collect pinball machines and they are regularly over $10,000 for the highly-
sought titles. Unlike a car which needs to be registered, they are "cash and
carry" items and accepting any form of payment other than cash is risky
(paypal? cheque? I think not).

It's like buying stuff at a garage sale with a credit card. Ridiculous.

~~~
tdb7893
"Transactions with financial institutions or consumer to consumer non-business
transactions will not be affected" so my interpretation is that your use case
doesn't apply but I'm not sure

------
CryptoPunk
This flies in the face of liberal democratic tradition. It effectively makes
it mandatory to utilize a network, that bars any party not licensed by the
government from acting as a node (the inter-bank network), for any significant
economic exchange.

I suspect that by increasing the cost of law abidance, it will encourage
defection from the formal economy and its democratically accountable judicial
system.

~~~
hndamien
I had all but given up on our banks. They are really herding us into the arms
of crypto. Now I just need a Monero hardware wallet.

~~~
sho
> Now I just need a Monero hardware wallet

I'm going to go out on a limb and predict you will never, ever be able to buy
anything physical with Monero. Especially something over $10k or shipped over
international lines.

edit: if you are claiming I am wrong, let's see a URL with a physical product
available with payment in Monero

~~~
45h34jh53k4j
I think this is a very short sighted prediction. You could have said this
about bitcoin in 2010, and you would have been wrong then too.

~~~
45h34jh53k4j
Update: You could also have said this about dogecoin in 2013, and been wrong
also: (man sells house for $130k of dogecoin)

[https://edition.cnn.com/2014/02/26/tech/innovation/dogecoin-...](https://edition.cnn.com/2014/02/26/tech/innovation/dogecoin-
cryptocurrency-tech-irpt/index.html)

------
newscracker
Any push for eliminating cash is just another version of the nonsensical "if
you have nothing to hide..." argument all over again to curb freedoms.

> If we are going to refer to bank payments as ‘cashless’, we should then
> refer to cash payments as ‘bankless’. Because that’s what cash is, and right
> now it is the only thing standing between us and a completely privatised
> money system. [1]

For those who are arguing about an inevitable future where cash won't exist,
I'll just say that people will find other ways to transact (like barter,
cryptocurrency, shadow currencies). And those will be for legal purposes and
illegal purposes, depending on the people and the situation. Blanket
assumptions of crime and illegal activities with cash are extremely naïve.

[1]: [https://aeon.co/essays/if-plastic-replaces-cash-much-that-
is...](https://aeon.co/essays/if-plastic-replaces-cash-much-that-is-good-will-
be-lost)

------
MrMorden
Cigarette taxes north of $30/pack cause smuggling? I'm shocked to find
gambling in this establishment!

------
TomK32
How about publishing all government transactions, excluding salaries if we
must.

If that works out well we can move on to publishing all transactions over a
certain threshold (over a certain timeframe so you can't split the
transactions). And publish all transactions that go to certain countries on
black or grey lists.

Limiting cash transaction is a okay thing be there's much bigger fish to
catch, if only politics meant it seriously.

~~~
thatcat
>excluding salaries

Salaries are the most important transaction to monitor as they represent a
recurring expense and easily become inflated in the government sector.

Tax payers have a right to know what they pay for and how much it costs. What
reason are you using to justify publishing private transactions?

~~~
TomK32
> excluding salaries _if we must_

My view might be biased as I live in Austria which is well-know for government
subsidies and funding. And that includes gold handshakes to send 50 yr-olds
into early retirement. WHY THE FUCK!?!

Anyways, my point being: Instead of outlawing big cash payments (hard to
achieve in my eyes) the government has a lot of opportunities where it can
show the transparency needed to re-establish trust from the plebs (sorry,
citizens).

I'd see publishing public transactions as a first step and private ones as a
second step. I mean, all we know about that dutch-irish sandwich is fairly
limited, but if those transactions had been public early on some data
scientist would have said "oh, that looks funny".

------
hnaccy
The state will always seek more control over the individual, this is the
state's MO.

There is a slope and it's very slippery.

------
paranoidrobot
Note that an important clarification is that person-to-person transactions are
still permitted in cash, without limit.

So if you want to sell your house, and someone else wants to pay for it in
cash, then you're all fine.

~~~
pjc50
Presumably there's an ID requirement in the conveyancing somewhere and the
transaction goes through a land registry?

------
wemdyjreichert
It's not just the "war on cash". This "PAYG" thing is screwing over taxpayers.
They could otherwise invest that money, make a return, then divest before the
end of the year, earning a small profit. This robs them of that right so the
government can instead. Disgusting.

~~~
slagfart
Credit is honestly cheap enough that, if you really wanted to invest money
that is a liability from the second you earn it, you could.

All other things being equal, if the government earns the money upfront
instead of having to wait, tax rates can decrease slightly for the same amount
of income. I live in a PAYG country, and given higher rates of tax-default and
tax-stress in non-PAYG countries, I prefer PAYG.

------
pjc50
So, two questions:

\- how many purely above board transactions of this value are there to be
affected by this?

\- if people are to insist on financial anonymity, how is the tax burden to be
distributed fairly?

~~~
seem_2211
Yep - easy to have a visceral response to this change (how dare they cut down
on my civil liberties!) but what sort of above board thing would you need to
hand $10,000 over for?

The only real example I can think of is buying a car, and even then, that's
not that likely, that you'll use cash.

Also how do you even get out $10,000? Most ATMs and banks have fairly low
withdrawal limits.

~~~
balabaster
Car dealerships often given huge discounts for cash purchases. So purchasing a
car with cash is actually more likely than you give credit for.

As for getting out $10,000 you'd usually need to go into a teller with at
least a couple of days notice to withdraw that kind of cash. It's easy to do,
if not exactly the most convenient. Getting money out of a bank isn't
restricted to ATMs or debit card use.

It's _your_ money, the bank is just borrowing it from you to increase their
spending power to increase their own profits and charging you for the benefit.
It's a total coup: When you put money in your account, _you 're paying them_
for the privilege of lending them your money to so they can make further
profits. You're still entitled to it back when you want it, in whatever forms
the bank are capable of providing, up to and including _cash_.

~~~
pjc50
Lots of places give big discounts for paying in cash .. so they can evade the
value added tax, and potentially hand the cash directly to employees evading
tax there.

(I don't actually mind this much for small amounts for small businesses, but
it does add up!)

~~~
metaphor
> value added tax

Bit of an oxymoron, but point well taken.

There exists a legit and conditionally significant operational risk to not
being paid in a timely manner. Waiting 30+ calendar days is commonplace in
private business-to-business transactions...problem enough that US Federal law
explicitly requires government agencies to include interest[1] on contractor
payments made after 30 calendar days of proper invoice. Furthermore, if
clearing time measured in days wasn't enough, the bank may even place a hold
on a appreciable percentage for weeks without prior notice, and there's
nothing you can do but wait it out; anecdotally, it's happened to me on at
least one recent occasion with a large check issued by the Department of
Treasury.

[1]
[https://www.fiscal.treasury.gov/fsservices/gov/pmt/promptPay...](https://www.fiscal.treasury.gov/fsservices/gov/pmt/promptPayment/rates.htm)

~~~
pjc50
Late payment of invoices is a real problem for small businesses, yes. But the
real distinction is upfront/arrears, not how it's settled! Someone can fail to
pay an invoice in cash just as well as they can fail to pay it by cheque.

(I do think governments should try to heavily discourage long arrears and move
to e.g. 7 days being the norm; invoices are a form of unsecured credit that
can cause ripple collapses like any other form of credit.)

------
no_identd
The problems with this go a lot deeper than most people realize, but I can't
summarize them here. I strongly recommend reading the following paper to
understand the importance of cash:

[http://www.paecon.net/PAEReview/issue80/Huber80.pdf](http://www.paecon.net/PAEReview/issue80/Huber80.pdf)
Huber, Joseph - Split-circuit reserve banking - functioning, dysfunctions and
future perspectives

Abstract: "This paper first provides a detailed outline of how the present
money system works. This then serves as a backdrop to discuss a number of
orthodox fallacies and heterodox flaws in money theory, followed by a summary
of the dysfunctions of split-circuit reserve banking and a brief outlook on
the perspective of a single-circuit sovereign money system."

Keywords: monetary economics, money theory, credit creation, banking theory,
fractional reserve banking, monetary policy, monetary reform

One may find comments on the paper here: [https://rwer.wordpress.com/comments-
on-rwer-issue-no-80/](https://rwer.wordpress.com/comments-on-rwer-issue-
no-80/)

------
pg_bot
The path to hell is paved with good intentions.

------
JTbane
The so-called 'war on cash' seems to be progressing nicely.

Don't the bankers know that this will only make cryptocurrency more attractive
to those who want privacy?

~~~
mywittyname
> Don't the bankers know that this will only make cryptocurrency more
> attractive to those who want privacy?

Yes they do, that's why they've become so heavily invested in it over the past
few years. They can force onto normal people these absurd limits on the use
cash, while controlling the most viable alternate transaction method.

So, people in both legal and illicit businesses need the bankers.

------
grey-area
_Physical_ currency is going away in our lifetimes. What it is replaced by
(digital cash owned by governments, corporate scrip, independent decentralised
currencies) is up for debate, but its demise is not.

Physical currency is controlled by governments, since it is expensive to
produce and distribute, and network-connected payments are becoming more and
more prevalent, it is inevitable that at some point the cost benefit ratio
becomes untenable for governments and they remove this option.

If you fight for its existence against the government which claims sole
jurisdiction over it in the first place, you're fighting yesterday's war, and
doomed to lose, better instead to imagine a different future based on digital
currencies (of whatever stripe). I'm not keen on bitcoin et al, but the future
is clearly not in physical tokens which represent fixed denominations of
currency.

If you were starting a currency today, would you start with cash?

~~~
ddebernardy
Cash is the only way to keep one's spending private. (Anything else involves
some kind of ID which, even if anonymous, can be traced back to you
eventually.)

~~~
jerkstate
well, there's also Monero

------
jacquesm
The best thing they could do to get people not to use cash for legal
transactions is to increase the interest rates.

People doing illegal transactions will just use a substitute.

------
majortennis
Australia tax things like cigarettes massively. I think any black market
tobacco is because of their excessive taxing

~~~
Raphmedia
Taxing something you can grow in your own yard will always cause a black
market.

------
lr
I think both the US and Australia (and probably other countries), should just
do away with the $50 and $100 bills. It becomes a lot more inconvenient if you
have to carry around 5 times as many briefcases of cash for illegal
transactions.

~~~
stronglikedan
You do realize that there are large _legal_ transactions that should be
allowed to be made without privacy violations, don't you?

~~~
maxk42
... or wheelbarrows

------
elvirs
so how many of you who is opppsing this has paid for or sold something in cash
amount larger than 10k? Other than buying a used vehicle I dont think regular
people engage in large cash transactions. While tons of untaxed money changes
hands between rich crooks to buy and sell valuable items bypassing any
taxation or tracing. Before you start advocating for rich crooks, think again
what is in it for you that you want to fight for it so bad

~~~
alistairSH
Stop thinking about individual consumers, who may or may not have $10k+
transactions very frequently.

Instead, think of small businesses. They regularly have the opportunity to
have large transactions. Vehicles, livestock, capital equipment.

~~~
mperham
And they use checks, bank transfers, etc for those transactions. Not cash.

~~~
pjc50
Exactly. What business owner is going to entrust huge amounts of cash to staff
if they don't have to, or aren't going through cash to keep it off the books?

------
sho
This is totally inevitable everywhere and in fact cash itself will probably be
gone by 2050. Make whatever principled claims you wish but I would almost bet
money that 80%+ of cash purchases over $10k even today have something dodgy
about where that money came from. You think governments don't know that? Their
whole job is to prevent crime. This will make money laundering much harder and
_you know that_. If the collateral damage is that lone couple of paranoid
weirdos in each city who don't trust banks and actually store their savings
under the mattress, well so be it.

The appropriate response to this is not to try to ban it in the name of
"privacy" because the stats will overwhelmingly not be in your favour. The
correct response is to demand and implement appropriate and ironclad data
privacy laws which make it literally impossible for agencies to do whole-
database searches, go on fishing trips, or other abuses of data collection
tech. A police agency should not be able to query every name who made a large-
amount purchase. However, they should be able to, given a name, see what
purchases that person has made. This is a _critical_ distinction.

Give up with the "the government should not be able to track my money flows!"
argument. Might makes right, basically. Instead, focus your energy on legally
constraining the use of that data to conform to principles of reasonable
freedom and dignity. That is the only approach that will work, IMO.

~~~
misja111
Nobody is denying that total government control over money flows will make it
more difficult to launder black money. Surely this is a benefit of abandoning
cash. But there are also drawbacks:

\- you are forced to pay fees for a bank account

\- in most countries, banks require you to be registered at a home address to
open an account

\- not every government can be trusted with the control over your money. Think
of Venezuela or Zimbabwe, for instance

~~~
toss1
The fees for a bank account are a good point.

Yet, holding cash will similarly erode your value due to inflation, which is a
designed-in feature of fiat currency and central banking.

Also, fees generally go away with sizeable accounts and interest can be
earned.

Anonymity, however, is gone for sure with Know Your Customer laws

~~~
michaelmrose
Except there has been discussion relatively recently of negative interest.
Charging you a percentage of your money to hold it. Having cash as an option
acts as a hedge against this stupidity. You can't be so ridiculous that people
would rather stuff it in a safe.

