Luxury goods worth over Rs 10 lakh, such as handbags, watches, art, and yachts, will now be subject to a 1% Tax Collected at Source (TCS) starting from April 22. This new provision, outlined in the Finance Act 2024, is designed to bolster the income tax department’s monitoring of high-value transactions by requiring PAN details for such purchases. The move is expected to increase transparency and accountability in the luxury goods market, ensuring that individuals making significant purchases contribute their fair share of taxes. The TCS on luxury items aims to curb tax evasion and streamline the reporting process for authorities. With this development, taxpayers in India will need to be mindful of the additional tax implications when indulging in extravagant purchases. The enforcement of TCS on luxury goods serves as a proactive step towards combating tax evasion and promoting fiscal compliance. It is essential for individuals involved in high-value transactions to adhere to the new regulations to avoid any penalties or legal repercussions. By implementing this measure, the government aims to create a more robust tax framework that addresses loopholes in the system and promotes a culture of transparency and accountability in financial dealings.