founders and senior executives of newage stock investing platforms such as indmoney vested finance and stockal met officials in the finance ministry on monday to discuss the possible implications of a proposed 20 levy on foreign remittances under the liberalised remittance scheme lrs for retail investors investing in us equity instruments two people aware of the discussions told etthe stakeholders explained the impact of the levy on retail investors the sources saidfinance minister nirmala sitharaman proposed in the budget to raise the tax collected at source tcs to 20 from 5 earlier and remove the rs 7 lakh limit below which tcs was previously not applicable on foreign remittancesthis has directly affected fintech firms that offer usequity investmentsthey believe the proposed increase in tcs on such transactions will hurt retail investors and curb the growth of the industrythey acknowledged our stance and said that they will relook at the concerns and come back with what best can be done after their meeting later this month they also said that the slabwise approach of charging tcs also made sense one of the sources briefed on the matter saidexecutives of at least five fintech firms were present during the meeting the person addedlast month these firms had written to the central board of direct taxes cbdt on the proposed levythey sought a slabbased structure proposing that the 20 tcs provision be retained only for foreign remittances of rs 7 lakh and above per individual annuallybelow the threshold no tcs should be levied on customers these firms said in the letterthis is to separate highnet worth individuals hnis and protect the middleincome retail investors who on average invest less than rs 15000 per remittance in us equities through lrs transactionsin the letter sent by industry body internet and mobile association of india the fintech firms also provided a detailed explanation about the demographic of investors investing in usequities through these platforms sources briefed et on the contents of the note saidindiatech an industry body whose members also include neobanking and investment platforms such as moneyhop and indmoney has also written to the government on the issueaccording to one of the written representations seen by et the industry has said that for these investors annual remittance value per individual is less than rs 1 lakh with almost two of every three investors being salaried individuals and already subject to withholding taxesfurther 71 of investors in foreignlisted equities fall under an annual income bracket of up to rs 10 lakh the industry has arguedet was the first to report on february 17 that fintech firms that allow users to invest in usequities were planning to write to the cbdt on the adverse impactneobanking platforms such as fi which are actively looking at this usecase of usstock investing have also joined the representationthe recommendation from the industry to the government is to introduce a slabbased structure by bringing back the rs 7 lakh annual threshold over which a 20 tcs can be charged to individuals it