During the holiday season travel rush, overseas remittances surged to $2.4 billion in December 2023 from a nine-month low of $1.9 billion in November. Despite the widening of the scope of tax collection at source (TCS) in the previous year's Budget, December remittances were 16% higher than the $2 billion recorded in the year-ago period.
June 2023 witnessed the highest ever remittance of $3,890 million following the announcement of TCS implementation from July 1, 2023. Additionally, June also marked the highest remittance for overseas education at $890 million. In August 2023, Indians spent over $2 billion on overseas travel, marking the highest spending overseas during that period.
The highest contribution to the increase in remittances in Dec came from foreign travel, where spending increased to $1,548 million from $1,180 million in Nov. Spending on education increased to $267 million in Dec 2023 from $207 million in Nov. “There are several factors that led to the increase in Dec. Besides the holiday travel during Dec, there was the student-related demand with many of them travelling during Dec for courses that start in Jan 2024,” said M Hariprasad, executive director, Ebixcash World Money.
“There was also an increase in remittances because Canada has doubled the General Investment Certificate requirement to CAD 20,635 from CAD 10,000, and many travellers rushed to book investments before Jan 2024,” he added.
In November, the total remittances abroad decreased to $1,878 million, marking a decline of $298 million from the previous month, reaching the lowest level since February 2022's $1,823 million. Under the LRS scheme, Indians can send up to $250,000 abroad annually.