From tax certainty to confidence

The CBDT chairman’s articulation at OECD stands in stark relief against the historical scepticism that has long haunted the Indian tax landscape

- MUKESH BUTANI SEEMA KEJRIWAL

RECENTLY, THE CENTRAL Board of Direct Taxes (CBDT) chairperson made a spirited speech on Tax Certainty Day at OECD’s Paris centre, with a manifesto for transformation. The core message—that India’s tax regime is now anchored in the trinity of simplification, technology, and trust—stands in stark relief against the shadow of historical scepticism that has long haunted the Indian tax landscape.

For decades, the global perception of India's tax enforcement and administration machinery was one of a complex, unpredictable, and often adversarial behemoth.This scepticism was not a single flaw but a confluence of issues: complex laws, patchy drafting, and inadequate administrative guidance with cumbersome compliance, and a tendency to foster a culture of litigation. The ultimate symbol of this instability was the infamous retrospective tax amendment of 2012,which signalled to the world that policy was not sacrosanct and long-term investment was indeed a hazardous gamble.

Today, the government is going all out with confidence and a shift in tone. The chairman's vision—articulated through the acronym PRUDENT (professional, responsible, understanding, diligent, empathetic, non-intrusive, and technology-driven)—is not just a slogan; it is a direct repudiation of the “tax terror” narrative. This weaves in support to FM Nirmala Sitharaman’s clarion call in the 2025 Budget: “Trust first, scrutinise later”.

The evidence of this shift is visible in two critical areas.