Luxury goods above Rs 10 lakh to attract 1% TCS: What you need to know

A 1% Tax Collected at Source (TCS) will be levied on luxury goods priced above Rs 10 lakh. This applies to items like watches, handbags, art pieces, and more. This measure aims to curb tax evasion and ensure tax compliance.

Tax rules

The Central Board of Direct Taxes (CBDT) has tightened tax rules for high-income earners. From April 22, a 1% TCS will apply to luxury goods over Rs 10 lakh.

Income tax rules

The government expects to earn Rs 140-210 crore annually from the 1% TCS, potentially reaching Rs 500 crore. This measure aims to ensure compliance with income tax rules.

Luxury goods

The Income Tax Department announced new rules for a 1% TCS on luxury goods exceeding Rs 10 lakh, including watches, art, collectibles, boats, and more.

To track high-value purchases

This measure, announced in the July 2024 budget, aims to track high-value purchases and curb tax evasion by linking them to income details. India's luxury market is expected to grow rapidly.