India's Income Tax Reforms Raise Compliance Burden Amid Simplification Push

Tax experts warn that Indian taxpayers with multiple income streams face a growing compliance burden. Kinjal Bhuta of the Bombay Chartered Accountants' Society highlighted the need for detailed reconciliation of AIS, Form 26AS, TDS certificates, bank statements and investment records, noting that each source—salary, freelance work, rentals, capital gains, dividends and digital assets—requires separate reporting.

At the same time, the government has introduced a new Personal Income Tax Act in 2025 aimed at simplification. The act cuts the number of chapters from 47 to 23, reduces sections to 536, and halves the total word count. Officials say personal tax collections reached ₹11.56 trillion in FY 2024‑25, surpassing corporate tax for the first time, with 91.9 million taxpayers. The reforms are presented as a move toward greater transparency, digital compliance and reduced disputes.