Central Govt may Decriminalise Minor Income Tax Offences in 100 Days, says Sources

Following the new Cabinet's swearing-in, sources reveal that the Central Government plans to decriminalise minor income tax offences within the next 100 days. \r

A senior official indicated that this move aims to replace prosecution with penalties, enhancing ease of doing business and meeting industry demands. "To boost ease of doing business, the Centre intends to decriminalise specified provisions in the Income Tax Act," the official stated. \r

Discussions are ongoing to establish thresholds for compounding minor offences, which currently can lead to criminal prosecution, such as delayed Tax Deducted at Source (TDS) payments. Industry advocates argue that penalties should deter such infractions, treating them as civil liabilities rather than criminal acts. \r

The initiative seeks to improve taxpayer-authority relations and streamline tax compliance across direct tax, GST, and customs laws.