On Friday, Niti Aayog advocated creating a modern tax framework focused on trust-based governance, emphasizing voluntary compliance, transparency, and fairness. In its working paper, the Aayog stated that India’s tax system must align with the Viksit Bharat@2047 vision by promoting growth, inclusion, and trust in governance.
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Niti Aayog Calls for Citizen-Friendly Tax Reforms
Niti Aayog emphasized the need to build a modern, predictable, and citizen-focused tax system to improve ease of doing business and quality of life. The Aayog highlighted government initiatives like “Transparent Taxation – Honouring the Honest” and the Jan Vishwas Act (2023) as key steps to simplify compliance. The working paper recommended that authorities evaluate criminal provisions in tax laws to ensure they remain justified and necessary. It also urged lawmakers to clearly define offences, keep them relevant, and review them regularly to maintain fairness and effectiveness.
The Aayog stressed that authorities should punish only actions causing real and measurable harm, and ensure penalties match the seriousness of the offence to avoid harsh punishment for minor violations. The Income-tax Act, 2025, criminalizes 35 different actions and imposes mandatory minimum imprisonment for 25 offences, limiting judicial discretion.