Income Tax Department Official Provides Update on Tax Refund Process Under New Legislation

New Income Tax Act Aims to Simplify Compliance and Reduce Litigation

The new Income Tax Act, which came into force on April 1, 2026, aims to reduce litigation, simplify compliance, and build a transparent, technology-driven ecosystem for taxpayers. According to a senior official, the goal of the new law is to make the language simpler and easier to understand, ensuring that taxpayers and tax authorities are on the same page.

The Income Tax Act of 1961, which has been in place for over six decades, had become "bulky" after more than 4,000 amendments. This has often led to disputes due to varying interpretations of provisions. In contrast, the new Income Tax Act, 2025, has made significant changes to address these issues.

The Income Tax Department has launched several initiatives to promote voluntary compliance and reduce friction between taxpayers and authorities. One such initiative is the 'Kar Saathi' AI-powered chatbot, which is available 24x7 to address taxpayer queries instantly. Additionally, the 'Kar Setu' initiative offers more than 2,000 FAQs and educational brochures to help taxpayers understand provisions of the new law in simple language.

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To improve outreach in Maharashtra, educational booklets related to exemptions and tax deducted at source (TDS) have been printed in Marathi. This is part of the department's effort to make the new law more accessible to taxpayers.

The Income Tax Department will also be organizing a Mega Event under "PRARAMBH 2026" (Policy Reform and Responsible Action for Mission Viksit Bharat) focusing on the Income-tax Act, 2025. The campaign will take place across 23 districts under the Pune region to familiarise taxpayers with the new regime.

A key outreach event has been scheduled on May 15 at the Cosmos Bank Auditorium in Pune. This event will be attended by Rajya Sabha MP Dr Medha Kulkarni, industrialist Lila Poonawalla, and MCCIA president Pradeep Bhargava, among others. Subsequent programmes will be organized in 10 to 12 additional districts from May 18 onwards.

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The department's goal is to reach out to the last taxpayer and make them understand the ease of doing business with the Income Tax Department. The programme will bring together legal professionals, chartered accountants, and representatives from industry bodies to discuss the practical implications of the new law and the broader vision of a taxpayer-centric administration.