Finance Minister Nirmala Sitharaman introduced the Finance Bill 2023 on 24 March. More than 45 changes have been made in the Finance Bill 2023, which was passed by the Lok Sabha amidst sloganeering by the opposition members. If you also travel abroad and do ment with credit card, then this news is useful for you.
What has changed related to foreign trips?
In her speech, Nirmala Sitharaman said that it has been considered that payments for foreign visits through credit cards are not being taken under the Liberalized Remittance Scheme (LRS) and they would have avoided tax collection at source.
Request made to central bank
Therefore, the Reserve Bank of India (RBI) is being requested to look into bringing credit card payments for foreign visits within the ambit of LRS and collecting tax thereon at source. Its purpose is to ensure that such expenses come under the ambit of Tax Collection at Source ie TCS.
The Liberalized Remittance Scheme (LRS) was first introduced on February 4, 2004 with a limit of $25,000. Over the years, the limit has been increased with the changing economic conditions.
LRS is a program that allows individuals in India, including minors, to make multiple transactions, such as current or capital account transactions or a combination of both, up to $2,50,000 in a financial year (April-March). Allows free remit up to Rs. However, this scheme is not available for Corporations, Partnership Firms, HUFs, Trusts etc.