NewsStocksBudget 2026: Tax Experts Prioritise Stability and Administrative Reforms Over Rate ChangesBudget 2026: Tax Experts Prioritise Stability and Administrative Reforms Over Rate Changes
Tax experts are urging the government to focus on stability and administrative reforms in Union Budget 2026 rather than major policy changes. With the new Income-tax Act 2025 taking effect from April 2026, professionals want simpler compliance procedures, faster dispute resolution, clearer GST guidelines, and solutions for NRI taxation bottlenecks. The consensus emphasises allowing recent reforms to settle while addressing longstanding compliance challenges through measured administrative improvements.
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As Union Budget 2026 approaches, tax professionals across India are sending a clear message to the government: prioritise stability and administrative efficiency over dramatic policy changes. With the new Income-tax Act 2025 scheduled to take effect from April 1, 2026, experts are advocating for a measured approach that allows recent reforms to settle while addressing longstanding compliance challenges.
Call for Policy Stability
Anil Harish, Partner at D.M. Harish & Co., emphasises that the most meaningful reform would be the absence of reform itself. He warns that amending the Income-tax Act 2025 before it comes into force would signal policy instability. According to Harish, the new Act primarily streamlines language and structure without significantly departing from the 1961 framework.
| Priority Area | Recommended Action |
|---|---|
| Surcharges and Cess | Complete elimination |
| Tax Return Forms | Radical simplification |
| Policy Changes | Minimal amendments to new Act |
| Implementation Focus | Administrative improvements |
Administrative Reforms Take Priority
Ankit Rajgarhia, Designate Partner at Bahuguna Law Associates, notes that professionals are urging the finance minister to prioritise administrative fixes over headline-grabbing tax cuts. The focus areas include reducing TDS rates, simplifying withholding compliance, and accelerating dispute resolution to address the mounting backlog of income-tax appeals. For salaried taxpayers, key demands include higher standard deductions and clearer rules within the new tax regime.
Corporate and Investment Concerns
On the corporate front, manufacturing companies are seeking the reintroduction of concessional tax regimes to encourage new investments and job creation, according to Kunal Savani, Partner at Cyril Amarchand Mangaldas. He highlights significant gaps in digital economy taxation, particularly for crypto assets and derivative-based transactions, where the current framework imposes 30% tax on gains without allowing expense deductions or loss set-offs.
| Taxation Challenge | Current Issue | Proposed Solution |
|---|---|---|
| Crypto Assets | 30% tax, no expense deductions | Allow loss set-offs |
| Manufacturing Investment | Limited concessional regimes | Reintroduce tax incentives |
| Digital Economy | Unclear framework | Comprehensive guidelines |
NRI Compliance Bottlenecks
Non-resident Indians face specific challenges that require targeted solutions. Aarjav Jain, Executive Director at Dinesh Aarjav & Associates, highlights growing digital bottlenecks in income tax compliance. Aadhaar-linked OTP requirements and net banking access failures have prevented many NRIs from completing return verification or receiving refunds despite timely filings.
Key NRI Issues:
- Double taxation of foreign retirement accounts
- Cumbersome TDS procedures on property sales
- Foreign tax credit mismatches due to differing financial years
- Digital verification challenges
GST and Indirect Tax Expectations
Indirect tax experts are closely monitoring GST reforms. Jitendra Patel, Partner – Indirect Tax at N A Shah Associates LLP, notes that while GST 2.0 aims to simplify rate structures, compliance remains demanding for small businesses. Priority areas include stable return formats, resolution of legacy Input Tax Credit mismatches, clarity on real estate GST issues, and faster operationalisation of the GST Appellate Tribunal.
Senior Citizens and Social Security
CA Pretti Malhotra of Wise Finserv addresses the lack of meaningful social security for retirees dependent on interest income. She advocates for a separate lower tax bracket for senior citizens without pensions, clarity on National Pension System taxation, rationalisation of notional rent provisions, and expedited refund processes.
Transition and Implementation Challenges
CA Suresh Surana emphasises the need for explicit grandfathering provisions covering losses, credits, incentives, and pending proceedings during the transition from the 1961 Act to the Income-tax Act 2025. He supports reducing penal provisions and moving away from aggressive enforcement, particularly for technical rather than wilful defaults.
The consensus among tax professionals reflects a desire for measured governance that prioritises compliance simplification and dispute reduction over sweeping policy overhauls. As Budget 2026 approaches, the emphasis remains on creating a stable, predictable tax environment that supports both taxpayer confidence and administrative efficiency.
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