Govt will link TCS with TDS, says CEA
The move will help in ensuring cash flows of the individual taxpayers are not impacted
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New Delhi: The central government is attempting to link tax collected at source for payments made by individuals with tax deducted from their income sources, a move that will help in ensuring cash flows of the individual taxpayers are not impacted, according to a senior official.
The move also comes at a time when the government is set to impose a 20 per cent Tax Collection at Source (TCS) on certain international spends from July 1. Generally, TCS is the tax collected by a seller at the time of sale of goods or services while Tax Deducted at Source (TDS) is the amount levied as tax by the government.
The government has exempted transactions up to Rs 7 lakh from the TCS, providing relief to small taxpayers. So, bulk of the transactions made by most will not be covered under 20 per cent TCS, Chief Economic Advisor (CEA) V AnanthaNageswaran has said. Defending the decision, he said, "And it (government) also attempts to link the TCS with your TDS such that if there are TCS payment made by you it has to reflect a lower TDS.
