3715767 - Legal Change: India Budget 2026 - TCS Rate Revision for Scrap, Minerals, Liquor, and Tendu Leaves- SAP S/4HANA Public Cloud

The Government of India, in the Budget 2026, has announced revised Tax Collected at Source (TCS) rates for specific goods including Scrap, Minerals, Liquor, and Tendu Leaves.

Effective from April 1, 2026, the following rate changes must be reflected in the system to ensure statutory compliance:

• Scrap, Minerals, and Liquor: Rate change from 1% to 2%.
• Tendu Leaves: Rate change from 5% to 2%.

This SAP Note provides the configuration steps for S/4HANA to update the rates to ensure statutory compliance.

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SAP S/4HANA Cloud Public Edition

Legal Change.

Changes in the TCS rates :

Step 1: Change the tax rate in Tax code to 2% at condition types JTC2 and JTC3.

SSCUI: Define Tax Codes for Sales and Purchases (101016)

IMG Path: Financial Accounting ->Financial Accounting Global Settings -> Tax on Sales/Purchases -> Define Tax Codes for Sales and Purchases

Step 2: Maintain Tax rates 2% at JTC2 and JTC3 condition in Condition Records.

Fiori App: Set Material Prices (Role: SAP_BR_PRICING_SPECIALIST)

IMG Path: Sales and Distribution ->Basic Functions ->Pricing -> Pricing Control ->Condition Tables and Field Catalog ->Change Condition Tables for Pricing in Sales

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