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RBI notified amendment with respect to the provisions of international credit card (ICC)
On 16 May 2023, the Ministry of Finance (MoF) in consultation with the RBI issued a notification amending the Foreign Exchange Management (Current Account Transactions) Rules, 2000 (CA Rules) to omit Rule 7 which exempted the applicability of LRS limit on payments made through ICC, thus, bringing the payment through ICC within the ambit of LRS and triggering the tax collected at source (TCS) on ICC payments.
In light of the concerns raised on payments through ICC being brought under the purview of LRS limits and the applicability of TCS on such payments, the MoF, revoking the amendment, reinstated Rule 7 in CA Rules vide gazette notification dated 30 June 2023, thereby, excluding payment through ICC from the LRS limit.
Source: Gazette notification issued by Ministry of Finance dated 16 May 2023 Posted by Ministry of Finance on 19 May 2023 Gazette notification issued by Ministry of Finance dated 30 June 2023