FM Nirmala Sitharaman outlines 5Rs of responsive tax governance at 167th Income Tax Day

📌 Summary:

• Union Finance Minister Nirmala Sitharaman addressed the 167th Income Tax Day celebrations of the Central Board of Direct Taxes (CBDT) in New Delhi
• She said the Income Tax Department's role has evolved from tax collection to a fair, efficient, transparent and taxpayer-centric administration
• Described the Income-tax Act, 2025 as a landmark reform that simplifies the law, reduces compliance costs and strengthens ease of doing business, backed by new rules and forms
• Outlined the 5Rs of Responsive Tax Governance — Recognise, Respond, Redress, Reflect and Reform — as guiding principles; urged the Department to move beyond grievance disposal to analysing and preventing recurring issues
• Called for greater tax certainty, reduced litigation, and treating honest taxpayers as partners in India's development
• CBDT highlighted technology-led administration: PAN 2.0, ITBA 2.0, IEC 3.0 and SAKSHAM NUDGE; FM released six publications on India's international taxation leadership

🎯 UPSC Relevance: GS3 (Indian Economy) — direct tax reforms, tax administration, ease of doing business, litigation reduction and use of technology in governance.

📝 Prelims Facts:

• Occasion: 167th Income Tax Day; organised by CBDT
• 5Rs of Responsive Tax Governance: Recognise, Respond, Redress, Reflect, Reform
• Tech initiatives: PAN 2.0, ITBA 2.0, IEC 3.0, SAKSHAM NUDGE; new law: Income-tax Act, 2025

🔑 Key Term: Income-tax Act, 2025 — the new direct-tax statute replacing the earlier Income Tax Act, aimed at simplification, reduced compliance cost and taxpayer-friendly administration.