Law on change in TCS regime to be finalized in due course

The relief announced on Wednesday can be given to the taxpayers through a press note

- Gireesh Chandra Prasad

The central government is working on legislative changes required to implement the relief on tax collected at source (TCS) on overseas remittances announced on Wednesday, which includes amendments to the Income Tax Act and notifications under foreign exchange management rules, three people familiar with the development said.

However, there is no requirement to hurry with legislative changes before 1 July, though the date is specified in the Finance Act, 2023.

The ministry of finance on Wednesday deferred the TCS rate hike to 1 October, brought back concessions for up to ₹7 lakh remittances abroad and dropped, for now, the plan to levy TCS on credit card use abroad.

“This (the relief announced on Wednesday) is a beneficial provision which can be given to the taxpayers through a press release, as also done earlier on a few occasions. It will be followed by an amendment in the Income Tax Act," one of the people cited above said on the condition of anonymity.