CBDT chairman Ravi Agrawal Those using ITR 3 and 4, including bizmen, professionals, freelancers and those under presumptive taxation, will get extra month to file returns, with the deadline extended to Aug 31, CBDT chairman Ravi Agrawal tells TOI . Excerpts:What will be your strategy to achieve the target?■ The target for the next year is based on a nominal GDP growth of 10%, and above that is tax buoyancy (tax growth as a ratio of GDP expansion). The tax buoyancy that is being projected is reasonable. Therefore, we should not find any problem in achieving that target.We have ushered in a lot of initiatives to bring in trust, and taxpayers are responding to it. There is greater focus on promoting better compliance because that means more conversion of data into revenue. If you can do that, it helps widen the tax base and also deepen it.We will have a new Income Tax Act, which is simpler. The sentiment will be positive and that will help bring more clarity into the processes and trigger higher compliance. We will notify rules and forms in Feb. It will simplify processes in the sense that forms will be made smarter and aligned with tax returns or audit reports to take care of disconnects and discrepancies, if any. It will be easy to identify red flags.What kind of red flags?■ Red flags like incorrect claims or not incorporating certain income. We have data and we can tally that. Analytics will help. The process will be strengthened. All this will send a strong message to the taxpayer community that you need to be consistent. That process has been initiated, and people are responding to it.What about widening the tax base?■ When you talk about widening, there is also an element of deepening. Deepening is when I ought to report X, but I have reported X by 2. In that case, the return should reflect higher income than what has been shown. Widening is to expand base. It is not just about people who file returns, but also those who have paid taxes (via TDS or TCS) but did not file returns.There is a third category too: where you have certain information and those people have neither made a tax payment nor filed returns. You need to move scientifically; deep analysis has to be done, and where data is mature, you can act. Our NUDGE exercise is a step in that direction. We have got a very satisfactory response. In the last two years, 1.1 crore people have either updated their returns or revised them, yielding additional revenue of Rs 8,800 crore. Of this, Rs 1,750 crore are cases where refund claims have been reduced. All this has been done in a very non-intrusive way and based on data available with us. Widening and deepening depend on TDS outreach and data sharing among departments.What is the volume of data and how do you handle and ensure security of this data?■ There are 650 crore data pieces of transactions that the department handles on a yearly basis. We are in favour of getting more data. The department is only using data on transactions that have been done. The data is 100% secure and there is a process.What would be the deadline for filing tax for a certain category of taxpayers?■ Right now, for ITR 1 to 4 and part of ITR 5 that is not audited, the due date is July 31. For ITR 1 and 2, we will retain July 31, and for ITR 3 and 4, we will shift it to August 31. We often get complaints about bunching. This is how you stagger compliance and make it easier. We will allow taxpayers to revise till March.How many taxpayers have shifted to the new tax regime?■ In assessment year 2024-25 (FY24), it was 76%, and in AY 25-26 (FY25), 88% of taxpayers moved to the new tax regime.There was some adverse market reaction on STT on the first day. Has that settled down? Will it be reviewed?■ The market shows that. 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Those using ITR 3 and 4, including bizmen, professionals, freelancers and those under presumptive taxation, will get extra month to file returns, with the deadline extended to Aug 31, CBDT chairman Ravi Agrawal tells TOI . Excerpts:What will be your strategy to achieve the target?■ The target for the next year is based on a nominal GDP growth of 10%, and above that is tax buoyancy (tax growth as a ratio of GDP expansion). The tax buoyancy that is being projected is reasonable. Therefore, we should not find any problem in achieving that target.We have ushered in a lot of initiatives to bring in trust, and taxpayers are responding to it. There is greater focus on promoting better compliance because that means more conversion of data into revenue. If you can do that, it helps widen the tax base and also deepen it.We will have a new Income Tax Act, which is simpler. The sentiment will be positive and that will help bring more clarity into the processes and trigger higher compliance. We will notify rules and forms in Feb. It will simplify processes in the sense that forms will be made smarter and aligned with tax returns or audit reports to take care of disconnects and discrepancies, if any. It will be easy to identify red flags.What kind of red flags?■ Red flags like incorrect claims or not incorporating certain income. We have data and we can tally that. Analytics will help. The process will be strengthened. All this will send a strong message to the taxpayer community that you need to be consistent. That process has been initiated, and people are responding to it.What about widening the tax base?■ When you talk about widening, there is also an element of deepening. Deepening is when I ought to report X, but I have reported X by 2. In that case, the return should reflect higher income than what has been shown. Widening is to expand base. It is not just about people who file returns, but also those who have paid taxes (via TDS or TCS) but did not file returns.There is a third category too: where you have certain information and those people have neither made a tax payment nor filed returns. You need to move scientifically; deep analysis has to be done, and where data is mature, you can act. Our NUDGE exercise is a step in that direction. We have got a very satisfactory response. In the last two years, 1.1 crore people have either updated their returns or revised them, yielding additional revenue of Rs 8,800 crore. Of this, Rs 1,750 crore are cases where refund claims have been reduced. All this has been done in a very non-intrusive way and based on data available with us. Widening and deepening depend on TDS outreach and data sharing among departments.What is the volume of data and how do you handle and ensure security of this data?■ There are 650 crore data pieces of transactions that the department handles on a yearly basis. We are in favour of getting more data. The department is only using data on transactions that have been done. The data is 100% secure and there is a process.What would be the deadline for filing tax for a certain category of taxpayers?■ Right now, for ITR 1 to 4 and part of ITR 5 that is not audited, the due date is July 31. For ITR 1 and 2, we will retain July 31, and for ITR 3 and 4, we will shift it to August 31. We often get complaints about bunching. This is how you stagger compliance and make it easier. We will allow taxpayers to revise till March.How many taxpayers have shifted to the new tax regime?■ In assessment year 2024-25 (FY24), it was 76%, and in AY 25-26 (FY25), 88% of taxpayers moved to the new tax regime.There was some adverse market reaction on STT on the first day. Has that settled down? Will it be reviewed?■ The market shows that. There is nothing as of now.
