News Other News

5% extra TCS on new car if IT returns not filed by buyer

Written by Nizam Shaikh

According to a media report, higher taxes will apply to individuals who have failed to file their tax returns in 2019-2020. The Central Board of Direct Taxes (CBDT) will apply a 5% TCS on individuals defaulting to the new rules. Debtors and collectors can also identify individuals on the income tax portal to check for compliance with Sections 206AB and 206CCA.

Increased TCS

The higher TCS will apply to individuals whose aggregate of TDS or TCS is INR 50,000 or more in 2019-2020. The person will be removed from the specified list when they file valid returns in the fiscal. If not, a TCS of 5% over and above the 0.75% will apply to such individuals who have not filed their return in Fiscal 2019-20. The authorities will charge the TCS on vehicles valued over INR 10 lakh.

High Import Duty

On the other hand, the Government is waiving off taxes to adopt electric vehicles in the Indian market. Foreign electric vehicles manufacturers are also requesting the Government to lower the import duty on cars. This will help develop the technology in the Indian market. Currently, the Indian Government imposes a 100% import duty on vehicles with CIF above USD 40,000. Recently, reports suggested that Tesla is trying to persuade the Government to reduce these import taxes to 40% in a bid to sell its vehicles in India successfully.

Locally Made Electric Vehicles

On the contrary, the Government of India has imposed a high import duty to encourage the adoption of locally made products. In the case of the electric vehicle manufacturer, the brand is trying to coax Niti-Aayog, the Indian Think Tank, to lower the taxes. The think tank could allow the reduction of tax in case of the electric vehicle manufacturer, only if Tesla plans to produce its cars in the Indian market, which will help local vendors to gain business.

Also Read: Mercedes-Benz dislikes import duty on cars in India