Credit Card Update: Good news for Credit-Debit Card users, now this tax will not be deducted..
Credit-Debit Card Payment: If you also use a debit or credit card, then there is good news for you. Giving information, the government has told that now if you spend up to seven lakh rupees abroad in a financial year through debit or credit card, then you will not have to pay TCS on this expenditure.
Finance Ministry gave information-
Amid criticism from various quarters, the finance ministry said in a statement that the move is aimed at removing procedural ambiguities concerning the Reserve Bank's Liberalized Remittance Scheme (LRS) and TCS. Earlier this week, the ministry decided to bring the expenses incurred through international credit cards under the ambit of LRS.
Rebate of up to Rs 7 lakh-
As a result, 20 percent TCS was imposed on him. Experts and concerned parties had expressed a sharp reaction to this. The Ministry has said that to remove procedural ambiguity, it has been decided that expenditure up to Rs 7 lakh in a financial year abroad through international debit or credit cards will be excluded from the Liberalized Remittance Scheme and thereon TCS will not be deducted.
TCS is not deducted from studies and treatment abroad
At present, TCS is not deducted on expenses up to Rs 7 lakh for medical treatment and studies abroad. TCS is deducted at the rate of five percent on such expenditure. The ministry said that the existing facility related to TCS will continue for payment related to education and health.
Data obtained from overseas remittance companies revealed that international credit cards are being issued with spending permissions over the existing LRS limit of Rs 2.50 lakh. According to the ministry, the RBI had also written to the government several times that the differential treatment of foreign debit and credit payments should be done away with.
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