1% Tax at Source only on retail sales of Motor Vehicles of the value exceeding 10L₹: CBDT Circular [Read Circular]
![1% Tax at Source only on retail sales of Motor Vehicles of the value exceeding 10L₹: CBDT Circular [Read Circular]](https://www.taxscan.in/wp-content/uploads/2016/06/Central-Board-of-Direct-Taxes-CBDT-Tax-Scan.jpg "1% Tax at Source only on retail sales of Motor Vehicles of the value exceeding 10L₹: CBDT Circular [Read Circular]")
Budget 2016 – CBDT – Taxscan
Budget 2016 – CBDT – Taxscan
In a Clarificatory Circular No 22/2016, dated 8th June 2016, the Central Board of Direct Taxes clarified Amendment in Section 206C vide Finance Act 2016.
The one percent tax collection at source introduced in this year’s Budget on motor vehicles sold with a value exceeding ₹10 lakh will apply only on retail sales transactions. It will not cover motor vehicles sold by manufacturers to dealers/distributors, the CBDT said in the clarificatory Circular.
However, it said the levy will not apply to the purchase of such vehicles by government departments, institutions notified under the UN privileges Act and High Commissions and Embassies.
The amendments brought in section 206C by
, 2016 are applicable form l SI June 2016.
The circular which also given certain ‘frequently asked questions’ (FAQs), also made it clear that the obligation to collect the tax would rest only with ‘individuals’ who are subjected to tax audit (under Section 44AB), not on all individuals.
Read the full text of the Circular below.
