Budget 2025 proposes to rationalise Time Limit to Impose Penalties

The Union Budget 2025 proposed rationalizing the time limit for imposing penalties. Under the new proposal, taxpayers will have more time to comply with penalty provisions under various sections of the tax laws. This will provide a more balanced approach by considering the complexity of certain cases and offering taxpayers an opportunity to rectify issues without immediate penalties. The move is expected to reduce the punitive approach in tax compliance and enhance fairness. This policy will help streamline penalty enforcement while offering individuals and businesses greater clarity on their obligations. It reflects the government’s broader intention to make tax laws more taxpayer-friendly and reduce unnecessary legal pressures.