CBDT Expands TCS Scope In Revised Form 27EQ To Include Luxury Purchases

The Central Board of Direct Taxes (CBDT) has issued a notification amending the Income-tax Rules, 1962, through the Income-tax (11th Amendment) Rules, 2025. This amendment introduces a significant change by mandating the collection of tax at source (TCS) on the sale of various luxury and collectible items. The move, implemented under Section 206C of the Income-tax Act, 1961, is aimed at enhancing tax compliance and broadening the TCS regime to include high-value goods and collectibles.

According to the notification [G.S.R. 252(E)], Tax Collected at Source (TCS) will now be applicable on the sale of a wide range of high-end goods. These include wrist watches, artworks such as antiques, paintings, and sculptures, as well as collectibles like coins and stamps. The scope also extends to luxury transport items including yachts, rowing boats, canoes, and helicopters.

Additionally, TCS will apply to items such as sunglasses, handbags and purses, branded footwear, and sports kits like golf and ski-wear. Other high-value products under this rule include home theatre systems and horses used for horse racing and polo.

This amendment has been integrated into Form 27EQ and comes into effect from the date it was published in the Official Gazette.