The month of October will start from tomorrow, with this, traveling abroad will also become expensive from tomorrow i.e. from 1st October. Actually, foreign tour packages are going to become expensive from tomorrow. At the same time, for traveling abroad, 20 percent TCS will have to be paid on tour packages worth more than Rs 7 lakh. Let us tell you, currently 5 percent TCS is levied on foreign tour packages worth more than Rs. 7 lakh, which will become 20 percent from tomorrow. Under RBI's LRS i.e. Liberalized Remittance Scheme, 20 percent TCS will have to be paid on foreign remittances from October 1, 2023. Earlier these rules were to be implemented from July 1, but the government gave three months time to the people for this and is going to implement new rules from October 1.
traveling abroad will be expensive
TCS imposed on foreign tour packages will have greater impact on those who are fond of traveling abroad. Its impact is going to be the most on those people who keep going abroad with tour packages. On tour packages costing more than Rs 7 lakh, 20 percent TCS i.e. Tax Collected at Source will have to be paid. Let us tell you, 5 percent TCS will continue on tour packages less than Rs 7 lakh. That means if your tour package is less than Rs 7 lakh then only 5 percent TCS will be charged on you.
Tour operators believe that the government's decision of 20 percent TCS may affect the tourism industry. Travel Agents Association of India has demanded the government to abolish 20 percent TCS on overseas tour packages. He says that domestic tour operators will suffer losses due to this.
it will not be affected
This decision will not affect expenditure of more than Rs 7 lakh on medical or education abroad. But like the old regime, 5 percent TCS will continue to be levied on medical and education expenses of more than Rs 7 lakh.
Higher tax on foreign remittances
Currently, under RBI's LRS, 5 percent TCS is levied on foreign remittances of more than Rs 7 lakh. But the government has increased it to 20 percent. Earlier, expenses incurred through international credit cards abroad were also brought under its purview. But due to delay in preparation by banks and card networks, the government has postponed the decision on TCS on credit cards for the time being.
Finance Ministry gave this argument
According to the Finance Ministry, payments made through debit cards are included in LRS but expenses made abroad through credit cards do not come under its purview. Due to which many people used to exceed this limit while making credit card payments. RBI had several times written letters to the government asking it to end discrimination in making debit and credit payments abroad.
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