WANT TO TRAVEL ABROAD? What if you have to shell out a few lakhs more upfront? Well, guess what, that’s just what you may have to do if you wish to travel abroad in a few months.
This is a result of the increase in tax collected at source (TCS) on some foreign transactions, like foreign tour packages, to 20 per cent (from the current 5 per cent) that Union Finance Minister Nirmala Sitharaman announced in the Budget for 2023-24.
According to Amit Singhania, Partner at Shardul Amarchand Mangaldas & Co, the government appears to have calculated that a person travelling abroad must fall in the 20 per cent income-tax bracket, which means they must earn ₹12–15 lakh a year.
WHAT IS TCS?
It is a tax collected at source (TCS) by the agent from the buyer on booking tour packages, or any other remittance abroad.
HOW DOES IT AFFECT YOUR TRAVEL?
If you spend ₹10 lakh on a foreign tour package after October 1, your TCS will almost double to around ₹1 lakh.
WHICH TRANSACTIONS ARE AFFECTED?
TCS applies to several foreign transactions, including on education loans, medical treatment and foreign tour packages.
This story is from the August 20, 2023 edition of Business Today India.
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This story is from the August 20, 2023 edition of Business Today India.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
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