As per a notification, tax for foreign exchange transactions will be calculated “at the rate of 0.1 per cent of the gross amount of currency exchanged for an amount up to Rs 1,00,000, subject to the minimum amount of Rs 25”.
For transactions between Rs 1 and Rs 10 lakh, the tax rate will Rs 100, plus 0.05 per cent of the gross amount of currency exchanged.
For transactions over Rs 10 lakh, rate of service tax to be levied has been fixed at Rs 550 plus 0.01 per cent of the gross amount of currency exchanged. However, the maximum amount of service tax paid has been capped at Rs 5,000.
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