Govt Cuts TCS on International Expenses, Boosting Outbound Travel
Foreign Travel Gets Cheaper as Govt Slashes TCS on Overseas Spending: The Union Budget 2026 has brought relief to people spending money abroad. The government has reduced the Tax Collected at Source (TCS) on overseas spending, making foreign education, medical treatment, and travel easier on the pocket.
Under the Liberalised Remittance Scheme (LRS), TCS on money sent abroad for education and medical treatment has been cut from 5% to 2%. This 2% TCS will now apply only on amounts above ₹10 lakh.
Those travelling abroad will also benefit. A flat 2% TCS will now be charged on overseas tour packages. Earlier, TCS was 5% and in some cases went up to 20%. The threshold limit has also been removed.
Tax experts say the move will improve cash flow. Earlier, higher TCS meant money remained blocked until tax returns were filed. With lower TCS, families will have more money available for expenses.
Experts add that the change will especially help students studying abroad, patients seeking treatment overseas, and middle-class families, while still allowing the government to track foreign remittances.
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