Cash purchases of jewellery will attract 1 per cent TCS (tax collected at source) from April 1 if the amount exceeds Rs 2 lakh, as against the current threshold of Rs 5 lakh. Once the Finance Bill 2017 is passed, jewellery will be treated on par with general goods which attract 1 per cent TCS on cash purchase of above Rs 2 lakh. However, as there is no special provision for TCS on its purchase, jewellery is now being clubbed in general 'goods' on which 1 per cent TCS is triggered if a single transaction exceeds Rs 2 lakh in cash. In a bid to check generation of black money through large transactions, after the Budget proposal to scrap the previous threshold of Rs 5 lakh is approved by Parliament "The Income-tax Act provides for 1 per cent TCS on cash purchase of goods or services above Rs 2 lakh. The definition of goods also includes jewellery and hence 1 per cent TCS would be applicable on jewellery purchased above Rs 2 lakh in cash," an official told(This article has not been edited by DNA's editorial team and is auto-generated from an agency feed.)

Source: dna February 19, 2017 06:45 UTC