The Finance Ministry approved a Tax Authority recommendation to dramatically reduce the legal limit for cash transactions, Globes reported on Thursday.
The cap for cash payments will cut almost in half, from NIS 11,000 to NIS 6,000 for businesses, and from NIS 50,000 to NIS 15,000 for individuals.
The measure, which entails adding a clause to the Economic Arrangements bill, is aimed at further reining in the problem of money laundering.
Minister of Finance Yisrael Katz has approved the proposal by Israel Tax Authority chief Eran Yaakov and the Ministry of Finance budget division. The Knesset Constitutional Committee will also have to sign on.
In addition, financial sanctions for businesses and criminal fines for individuals who transgress the limits will be established.
According to data gathered by the Israel Tax Authority, the current limits on cash payments has been effective. Some 84% of the public have been complying since they were introduced in January 2019.
The Tax Authority said that between February 2019 and the end of January 2020, it audited 20,654 businesses and found 3,392 violations of the law.