The government has released draft Income Tax Rules ahead of their April rollout, proposing sweeping changes aimed at simplifying compliance while tightening oversight of high-value and digital transactions. The proposals raise thresholds for mandatory PAN quoting across several categories, including cash banking transactions, vehicle purchases, property deals and hotel or event bills, easing compliance for smaller transactions. At the same time, the draft rules expand the list of metro cities eligible for higher House Rent Allowance (HRA) benefits. In a major move to enhance transparency in the digital economy, crypto exchanges and service providers will be required to share transaction data with tax authorities, bringing virtual digital assets firmly under the reporting framework. The rules also formally recognise the Central Bank Digital Currency (CBDC) as an accepted electronic payment mode. Together, the proposals signal a push to modernise India’s tax system, balance ease of doing business with stricter monitoring, and prepare the framework for a more digital and data-driven economy.
