Under the provisions of Tax collection at source (TCS) specific persons require to collect tax at 1 to 5 percentage for niche transactions from opposite parties. The percentage is dependent on the type of transaction.
These transactions are mostly constrained to business activities and not day-to-day money exchange. The person collecting TCS is given credit over his income tax return.TCS is now seen as an effective toll to curb tax evasion and black money laundering. From the year 2012 cash payments during purchase of bullion exceeding INR 2 lakhs and jewelry exceeding INR 5 lakh were brought under TCS. In the budget of 2016, various high value transactions were included under this taxation, such as, sale of automobile value exceeding INR 10 lakh and goods or provision or service over 2 lakhs.

The seller needs to collect additional 1 percentage from the buyer and pay it to the government. The seller can be anyone from a businessman to salaried employee. So TCS will affect all consumers willing to pay large amounts cash.TCS has existed even before but what lacks is implementation. Today government has increased its vigilance over jewelers and automobile makers over their sales activity. These are one of the major areas where people with huge amount of black money look out for investments.Government is also looking into sale of high value properties. Real estate is the dark area of illegal transactions. Also all transactions made require the details of PAN which makes it harder to cover tracks of income