`No proposal to replace income tax with transaction tax`

New Delhi: There is no proposal to replace income tax with the banking cash transaction tax, Parliament was informed on Friday.

"In the present there is no such proposal under consideration," Minister of State for Finance Santosh Kumar Gangwar said in a written reply in the Lok Sabha, in reply to a query as to whether the government was considering replacement of income tax with a banking cash transaction tax.

Banking cash transaction tax of 0.1 percent was introduced in 2005 on cash withdrawals above a certain limit -- this was withdrawn on April 1, 2009.

The collection from banking cash transaction tax was significant as compared to income tax collections, Gangwar said.