20% TCS on Credit Card Spending Outside India
A lot of Indians when they go out of country for vacation or for work related assignments, does not carry a lot of cash for various reasons. So tye next best option was to carry a credit card for international transactions. Yes you have a exchange fee as well as 5% TCS (Tax Collected at Source) until now. But recently Indian Government has changed this rule for 20% TCS that means 4x the amount which was collected earlier.
This move is mainly to track the high value spending outside India. A lot of people from India goes outside like Dubai and purchase quite a few items and to track all these government has come up with this option. But the thing is we can claim it back at the time of filing the ITR, it is just the matter of keeping the money with the government for some time for a high value transactions.
Now this will actually reduce the Credit Card consumption outside India and people will tend to carry cash or use the Debit Card (if it works) or Credit Card to some extent. This is where the Digital Currency is so so important. Any country can come up something like this, and to overcome all the hustle if we have a global currency which you holds, then you can use it anywhere in the world.
Think about a scenario we have a Bitcoin Mobile App, and any ATM can have a QR Code, scan it, pay it and you get the currency of whatever country you are in. Now replace Bitcoin with any digital currency including Hive, and yeah you can access the local currency with any digital currency. This should be the future and I do not have to bound myself with whatever government comes up with any country.
To be honest, all the governments want everyone to spend mostly in their country to that they can collect tax as much as possible. And that's why they are coming up with these things.