By:- Supreme kothari, Partner, Economic Laws Practice.
”Budget 2026 has provided significant relief for Indians planning to travel abroad, with a major proposal to reduce the Tax Collected at Source on overseas tour packages to 2% from the existing slab-based rates of 5% and 20%, with no minimum limit. This move is expected to make international bookings cheaper, simpler, and more accessible, easing the financial burden on travelers while encouraging more Indians to explore foreign destinations. By standardizing the TCS rate and eliminating minimum thresholds, the Budget also simplifies compliance for both travelers and tour operators, potentially boosting outbound tourism and benefiting allied sectors such as airlines, hotels, and travel agencies. Experts believe this reform aligns with the government’s broader goal of promoting ease of travel and transparency in pricing, making international vacations more financially feasible for families, students, and young professionals alike. Overall, the reduction in TCS is a tourism-friendly measure that not only supports travelers but also strengthens India’s global tourism footprint”
