New Delhi [India], November 25 (ANI): The new Income Tax Act is expected to expand India’s tax base by making compliance simpler and more accessible for individuals, institutions, and exempt entities, Debjyoti Das, Principal Chief Commissioner of Income Tax (Exemption), told ANI on Tuesday.
“As far as exemptions are concerned, even though revenue is foregone when it comes to exemptions, what I do understand is it is easier for many tax regimes to become part of this process so that they can file the return easily,” he said in an interview on the sidelines of an interactive session on taxation of charitable institutions and exempt entities at PHDCCI.
Das said the new framework is designed to draw more people into formal filing. The Income Tax Act, 2025, which will take effect on April 1, 2026, simplifies language, removes obsolete provisions, and consolidates and restructures the law. It introduces the concept of a “Tax Year,” replacing the “Assessment Year” and “Previous Year.” The government launched the reform effort to modernize and simplify India’s outdated tax laws, leading to the introduction of the Income-tax Bill, 2025. The Bill, reviewed by a Select Committee of Parliament and refined for greater clarity, was passed during the monsoon session and now forms the foundation of India’s new tax framework.
Das added that digital integration is accelerating the shift toward compliance. “Use of UPI is another example; every vendor is using UPI. Things are coming into the mainstream, and people want to come mainstream.”
A major factor expected to boost compliance, he said, is the design philosophy of the new Act itself. He noted that the current law had become “a little unwieldy” due to repeated amendments, making simplification necessary. The Finance Minister, he said, had emphasized the need for an Act that is “concise, lucid, and easy to understand,” aligning with the government’s broader efforts to make laws more accessible for the common person.
Das said the new Act is built with clarity in mind. “It is very concise; it is beautifully written. It’s in a flow, and tabular forms are there, and formulas are used. The language was difficult to understand earlier. It makes life easier for everybody,” he said, adding that the streamlined structure would reduce complexity and lead to “better compliance” across sectors, including exempt institutions and NGOs.
He also addressed ongoing registration cycles for charitable and non-profit entities, a core operational issue for the exemption ecosystem. Since April 2021, new non-profit organizations receive automatic provisional registration, allowing them to begin operations without delay. These entities must later return for regularization, when the department examines their activities and compliance records. Das said this approach ensures both facilitation and accountability.
Organizations registered before April 2021, which were automatically renewed during the transition, are now coming up for revalidation. Acknowledging the high volume of applications, he said that for “old trusts, if they are genuine, and there are genuine activities, it will be made as streamlined and easy for them as possible.”
Addressing concerns around CSR spending, Das said that while most companies follow proper processes, instances of misuse do occur. “Some CSRs are not very accurate, but this is not a regular practice. But as in everything else, there will be outliers… where we have seen CSR expenditure not being spent in the right way as it was supposed to be,” he said, urging tax practitioners and corporate representatives to remain vigilant. (ANI)
About The Author
