Foreign Travel To Cost More Starting July 1, Here Is All You Need To Know

Do you not want to take the much awaited international vacation to a tropical location? All of us have that travel junkie who can’t get enough of the wanderlust in their system. The demand for foreign travel is on the rise to the extent that it has risen exponentially with travellers wanting to escape to beautiful destinations. This wave has seen a sharp rise especially in the post COVID-19 era when the lockdowns were lifted and all the restrictions on travel were removed. Although the ticket prices are also seeing a sharp rise there is no stopping the globetrotters who want to escape to international vacations at the drop of a hat.

Tax Collected At Source To Increase By 20 Percent From July 1, 2023

This summertime is seeing a huge rise in the number of people taking holidays across the globe. The reason behind this surge is just the very busy vacation season. Another main reason for many people planning to travel abroad currently is the rise in Tax Collected at Source (TCS) from July 1, 2023. The increase in taxes is not limited to a few percent, but the new changes will make travel expensive by quite a margin.

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Tax Collected At Source Rates To Apply On International Credit Card Transactions

The increase in Tax Collected at Source by 20 percent applies not just to international tickets but on international credit card transactions as well. This means that even a direct booking would cost the traveller a 20 percent TCS, as per a circular issued by the Finance Ministry on May 16, 2023.

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According to a PTI report, the Ministry of Finance on May 16, 2023 notified the Foreign Exchange Management (Current Account Transactions) (Amendment) Rules, 2023. They will now include international credit card payments as well in the Liberalised Remittance Scheme (LRS). This is set to cause a further hole in the pockets of the travellers.