The Confederation of Indian Industry (CII) on Friday recommended more reforms to make India’s tax system “simpler, technology-driven and trustworthy” in Budget 2026-27. These changes, the industry body said, would help slash litigation, boost compliance, and align taxation policy with the vision of Viksit Bharat 2047.
It recommended the government fast-track all tax dispute cases above Rs 100 crore for resolution within a year through multiple virtual hearings.
Currently, more than 0.5 million appeals are pending before Commissioners (Appeals), involving almost Rs 18 lakh crore of disputed demand.
At a pre-budget meeting with Revenue Secretary Arvind Shrivastava, the CII said that to build taxpayers’ trust, the existing Taxpayers Charter could be elevated to the status of a Statutory Taxpayer Rights Charter, legally guaranteeing time-bound refunds, faceless assessments and appeals, accountability for delays. Such an enactment would send a powerful signal that compliant taxpayers are treated with fairness and respect, it said.
The CII said India’s tax deducted at source (TDS) framework, with more than 37 categories and rates ranging from 0.1% to 30% has become overly complex, creating reconciliation challenges and liquidity strain. It proposed a reduction to two or three broad categories in the YDS framework, exempting transactions between GST-registered entities since these are already captured digitally.
The industry body also demanded the Authority for Advance Rulings (AAR) be revived as an independent, quasi-judicial body headed by retired High Court judges, to deliver binding rulings within six months and open to joint applications from industry associations for sector-wide clarity.
The AAR is a quasi-judicial body established under Indian tax laws to provide binding advance rulings on tax matters to reduce litigation and provide certainty to taxpayers. It consists of a retired judge of the Supreme Court as chairman and two members.
For indirect taxes and customs, CII advocated a one-time dispute resolution scheme, longer advance ruling validity, and full digitalisation toward Paper-Free Customs by 2028, including e-refunds. The industry body also proposed a multi-year corporate-tax roadmap and the removal of minor non-wilful offences from prosecution provisions in both direct and indirect tax laws.
The CII hailed the strong reform momentum, which has led to a more predictable, technology-enabled, and growth-oriented tax environment. CII Director-General Chandrajit Banerjee said that the success of GST 2.0, the buoyancy in revenues, and the credibility of the fiscal-consolidation path have demonstrated that prudence and progress can move together. “The next stage of reform must ensure that taxation not only raises revenue efficiently but also acts as a catalyst for investment, innovation and competitiveness. The Budget can be a pivot for a truly modern, transparent and globally benchmarked tax regime,” he said.