New Income Tax Rule: Pay 1% TCS On These Goods Above Rs 10 Lakh | CBDT Notification

Income Tax: In a significant move aimed at tightening tax compliance and monitoring high-value transactions, the Central Board of Direct Taxes (CBDT) has issued a fresh notification regarding Tax Collection at Source ( TCS ) on luxury and collectable goods. 

This update has been introduced under clause (ii) of sub-section (1F) of section 206C of the Income-tax Act, 1961.

“In exercise of the powers conferred by clause (ii) of sub-section (1F) of section 206c of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby notifies the following goods of the value exceeding ten lakh rupees for collection of tax at source as specified therein…”

The notification lists a series of goods that will now attract TCS if their purchase value exceeds Rs 10 lakh. These include:

• Wrist watches
• Art pieces such as antiques, paintings, and sculptures
• Collectables like rare coins and stamps
• Luxury vehicles and vessels such as yachts, rowing boats, canoes, and helicopters
• High-end accessories like sunglasses, handbags, and shoes
• Sportswear and equipment such as golf kits and skiwear
• Home theatre systems
• Horses used for racing or polo

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How will it Affect You?

If you're buying any of the listed goods and the purchase exceeds Rs 10 lakh, the seller will now collect TCS from you. This tax will be paid to the government, and you can claim it as a credit while filing your income tax return. While this doesn’t increase your tax burden, it does mean more documentation and record-keeping.

This development reflects the government's continued effort to track luxury spending, curb tax evasion, and ensure that high-value purchases are properly accounted for in the financial system.