Union Finance Minister Nirmala Sitharaman stressed the importance of ensuring convenience for honest taxpayers while cracking down on tax evasion during the 167th Income Tax Day celebrations in New Delhi. She urged tax officials to distinguish between intentional tax evasion and genuine mistakes in dealing with taxpayers. Sitharaman highlighted the significance of tax certainty in promoting voluntary compliance, advocating a shift towards preventing litigation rather than managing it.
Tax certainty, according to Sitharaman, relies on three key pillars: clarity in taxpayer obligations through timely circulars, consistency in interpretation across jurisdictions, and continuous institutional learning from appellate orders to guide future reforms. She urged Income Tax Department officials to exercise their power with humility and focus on improving taxpayer services and ease of doing business through the ‘five Rs’ approach: recognize, respond, redress, reflect, and reform.
The Finance Minister emphasized the need to promptly recognize and address taxpayer concerns, respond with clarity and empathy, redress genuine grievances fairly and in a timely manner, reflect on the root causes of complaints for institutional learning, and continuously reform processes to minimize recurring issues. Sitharaman underscored the department’s expanded responsibility from tax collections to ensuring fairness, efficiency, ease of doing business, and service for taxpayers.
Sitharaman also highlighted the simplification of the Income Tax Act, 2025, aimed at reducing uncertainty and lowering compliance costs for taxpayers.
