1% TCS Compulsory on Sale of Luxury Goods and Motor Vehicles above Rs. 10 Lakhs w.e.f Jan 1, 2025

Starting January 1, 2025, the Indian government will mandate a 1% Tax Collected at Source (TCS) on the sale of luxury goods and motor vehicles valued above Rs 10 lakhs. This move aims to increase tax compliance and broaden the tax base. The TCS is applicable to transactions at the retail level and covers vehicles purchased for personal use. However, sales to government entities, embassies, and specific public sector companies are exempt. Dealers and manufacturers must collect this tax from consumers at the point of sale. The collected tax will be credited against the buyer's income tax liability.