BCAS President CA Anand Bathiya’s Message for the Month of March 2025

Get out of the way!

• Stop micromanaging economic activity!
• Give entrepreneurs and households back their time and mental bandwidth.
• Regulators should hold themselves to the same standards that they expect of regulated entities.

The preface to the Economic Survey 2024-25 resounds with a bold and decisive call for reform. These foundational principles underscore the broader vision through which our nation’s governing dispensation can truly embrace and enable ‘growth through deregulation.’

The core takeaway from this year’s Economic Survey is the imperative need for a substantial rollback of regulatory excesses, as well as a conscious restraint from layering policies with additional operational conditions under the pretext of preventing misuse. More often than not, such overregulation distorts the original intent of policy measures, hampering rather than facilitating economic dynamism. The Survey makes an insightful case for leveraging India’s deeply ingrained social trust structures to attain scale and efficiency, especially in its closely connected, kinship-based economic landscape. Each chapter of the Survey reinforces the necessity of ‘simplification and deregulation’ wherever feasible. As Chartered Accountants being enablers of commerce and enterprise, such unequivocal directional clarity in favour of effective deregulation is truly a welcome shift.

Encouragingly, early indicators of this ‘growth through deregulation’ vision are already visible. The conceptualization of a Deregulation Commission, backed by well-defined terms of reference and coordinated efforts between the central and state governments, is a promising step forward. However, the success of this initiative hinges on its substantive execution rather than merely its structural existence. If implemented with true intent and depth, this deregulation drive can significantly bolster the competitiveness of Indian businesses, enabling them to expand and scale with greater ease and speed.

A Budget with Balance and Direction

The month of February commenced with the high-decibel presentation of the Union Budget 2025, accompanied by the introduction of the Finance Bill, 2025. A strong emphasis on driving consumption-led growth was evident, while an impressive balance has been achieved on the fiscal front. The Society hosted two highly engaging Public Lecture Meetings: one on the Direct Tax Provisions under the Finance Bill, 2025 by Shri CA. Pinakin Desai, and another on the Indirect Tax Proposals under the Finance Bill, 2025 by Shri CA. Sunil Gabhawala. Both sessions were well attended and have since garnered over 15,000 views on the Society’s YouTube channel. Additionally, our esteemed BCAS publication on the Analysis of Union Budget 2025-26 is now available for complimentary download via the Society’s website.

The Much-Anticipated Income Tax Bill, 2025 – Simplification in Form and not Substance?

In her Budget speech, the Hon’ble Finance Minister underscored ‘taxation’ as the foremost lever for ‘transformative reform’ within a broader set of six identified reformative pillars. This set the stage—and expectations—for the unveiling of a new Income Tax Bill, which was subsequently introduced in the legislature a week later.

Given that the palimpsest Income Tax Act, 1961 has governed direct taxation for over six decades, the introduction of the new Bill was anticipated to be a landmark moment—one that would bring forth a contemporary, well-calibrated framework equipped with modern concepts to facilitate real ease of compliance and substantive deregulation.

However, upon review of the Income Tax Bill, 2025, it becomes evident that the ‘simplification’ proposed within it is largely cosmetic. The revisions primarily revolve around improved structural organization through better grouping of sections and chapters, rather than a meaningful reimagining of substantive provisions. While a detailed analysis does reveal a few high-impact potential changes, many appear to stem from drafting inconsistencies rather than deliberate policy shifts. It is reassuring to note that an ongoing review process seeks to address these inconsistencies, but the broader expectation of a comprehensive transformation in our tax statutes remains unmet.

Undoubtedly, rewriting well-entrenched and settled tax principles is a formidable challenge, and in many cases, an undesirable exercise. However, a more ambitious approach could have been undertaken—one that integrates fresh, progressive thinking into our tax framework in alignment with the overarching theme of ‘growth through deregulation’ as articulated in the Economic Survey. Alas, it appears that the journey toward a truly transformative tax regime is yet to be realised, and we must wait longer for substantive change.