What are the changes effected in tax policy in India after the Implementation of the recommendation of Tax Reforms Committee in 1994?

Simplification of Tax Structure

Rationalised income tax slabs and reduced rates curbed evasion; the Income Tax Act, 20251 aims to further modernise tax laws. This restructuring lowered marginal rates and reduced complexity, encouraging compliance.

Strengthening Tax Administration

Bodies like the CBDT’s departmental committee and schemes such as Transparent Taxation2 - Honouring the Honest enhanced institutional capacity and taxpayer trust. These reforms reduced discretionary powers of officials and improved service delivery.

Litigation Reduction

The Vivad se Vishwas scheme (2020) addressed pending disputes, improving compliance and reducing legal burdens. This initiative helped settle long-standing tax litigations, easing the burden on courts and taxpayers.

Further Simplification and Digitalisation

Implement the Income Tax Act, 2025 and expand faceless assessment nationwide, including Telangana’s districts. This will reduce litigation and enhance taxpayer convenience.

Inclusive Tax Base Broadening

Target informal sectors and small taxpayers, especially in rain-fed regions of Telangana, through awareness and incentives. Strengthening cooperative federalism by empowering state tax authorities will also improve mobilisation aligned with local economies.