Crime Today News
The Income Tax Department has announced said that purchases of these items will now attract Tax Collected at Source, at par with the tax levied on motor vehicles.
| Photo Credit:
MURALI KUMAR K
Planning to buy a wristwatch, sunglasses, handbags, purses, a pair of shoes or a home theatre system with a sale price of ₹10 lakh or more? Get ready to pay extra.
The Income Tax Department has announced that purchases of these items will now attract Tax Collected at Source (TCS), at par with the tax levied on motor vehicles.
In a recent notification, the Income Tax Department has listed 10 types of goods exceeding ₹10 lakh in value for collection of TCS. These include: wristwatches; art pieces such as antiques, paintings, sculptures; collectibles such as coins and stamps; yachts, rowing boats, canoes, helicopters; sunglasses; bags such as handbags and purses; shoes; sportswear and equipment such as golf kit, ski-wear; home theatre systems; and horses used in horse racing in race clubs or for polo.
“This notification shall come into force on the date of its publication in the Official Gazette,” it said. This means TCS will be applicable from April 22.
What is TCS, TDS?
TCS along with TDS (Tax Deducted at Source) are fundamental components of Indian taxation. TDS represents the tax deducted from payments made when the amount exceeds a set limit.
Conversely, TCS refers to the tax collected by sellers during transactions with buyers.
Both operate at the source of income or transaction and are proactive measures to streamline tax administration in the country.
TDS covers payments such as rent, salaries, interest and others. TCS covers the sale of goods such as luxury items, cars over a certain value, etc.
Section 206C amended
In another notification, the I-T Department has included the above mentioned 10 goods to Form 27EQ (Quarterly statement of collection of tax at source to be filed). This update follows the row relating to “Collection at source on sale of motor vehicle”. These two notifications aim to implement amendments to Section 206 C of the Income Tax Act, introduced through theFinance (Number 2) Act 2024.
Currently, section 206C of the Act provides for the collection of TCS on businesses trading in alcoholic liquor, forest produce, scrap, etc. Sub-section (1F) specifies that every seller who receives any amount as consideration for sale of a motor vehicle of the value exceeding ₹10 lakh must collect 1 per cent of the sale consideration as income tax at the time of receipt. The amendment added this scope to include ‘any other goods, as may be specified by the Central Government by notification in the Official Gazette’ in addition to motor vehicles.
According to the Finance Ministry, it has been seen that there has been an increase in expenditure on luxury goods by high net-worth persons. For proper tracking of such expenses and in order to widen and deepen the tax net, the list of goods for TCS has been expanded.
Published on April 23, 2025
📰 Crime Today News is proudly sponsored by DRYFRUIT & CO – A Brand by eFabby Global LLC
Design & Developed by Yes Mom Hosting
