CBDT Unveils CAP 2024-25: A Strategic Roadmap to Streamline Tax Compliance

The Central Board of Direct Taxes (CBDT) has announced the Central Action Plan (CAP) for 2024-25, aiming to expedite high-priority tax cases, broaden the tax base, and ensure stringent compliance. The plan targets high-risk sectors and mandates comprehensive PAN validation by March 2025.

The Central Board of Direct Taxes (CBDT) has introduced the Central Action Plan (CAP) for the fiscal year 2024-25, outlining a strategic roadmap for the Income Tax Department as India approaches its centenary of independence in 2047. The plan prioritizes the quick resolution of high-priority tax demand cases and aims to identify transactions above Rs 2 lakh in high-risk sectors like hotels and luxury retailers while broadening the tax base.

The CBDT has identified the top 5,000 tax arrear cases, which account for approximately 60 percent of the outstanding tax demand exceeding Rs 43 lakh crore. The CAP recommends forming a special team in each Principal Chief Commissioner of Income Tax (Pr.CCIT) zone, led by the Principal Commissioner of Income Tax (Pr.CIT), to conduct thorough analyses of these cases. The list of cases is expected by August 15, and the analysis should be completed by September 30.

To widen the tax base, the CAP emphasizes expanding taxpayer numbers and encouraging voluntary compliance. High-risk sectors, such as hotels, luxury retailers, and medical facilities, are frequently bypassing reporting requirements for cash transactions over Rs 2 lakh. The CAP mandates a verification process to scrutinize high-value consumption expenditures and ensure accurate reporting.