Finance Ministry Debunks Misreporting on ITCC Requirement for Indian Travelers

The Ministry of Finance clarifies that not all Indian citizens need an income-tax clearance certificate (ITCC) before traveling abroad. The provision applies only in specific situations involving serious financial irregularities or pending tax demands exceeding Rs 10 lakh, not stayed by any authority.

The Ministry of Finance has refuted claims suggesting that all Indian citizens need to obtain an income-tax clearance certificate (ITCC) before leaving the country. According to an official release on Tuesday, reports indicating such requirements are 'factually incorrect.'

The clarification comes amid confusion surrounding Section 230 (1A) of the Income-tax Act, 1961, which has been amended by the Finance (No.2) Act, 2024. The statement emphasizes that the amendment merely includes the reference to the Black Money Act, aligning it with existing tax laws for certain liabilities.

The Central Board of Direct Taxes (CBDT) has stated that the requirement for an ITCC under Section 230(1A) remains unchanged since 2003. It applies only in specific cases, such as serious financial irregularities or when tax arrears exceeding Rs 10 lakh are pending and not stayed by any authority. Approval from the Principal Chief Commissioner of Income-tax or Chief Commissioner of Income-tax is mandatory before demanding an ITCC.