TAX REFORMS IN INDIA: PROGRESS, PROSPECTS AND CHALLENGES

Abstract

Tax reforms play a pivotal role in shaping the economic landscape of any nation. India has undergone significant tax reforms, particularly with the introduction of the Goods and Services Tax (GST) in 2017, which simplified the indirect tax structure. Direct tax reforms, including the recent proposals to overhaul the income tax law, aim to broaden the tax base and enhance compliance. Over time, the government has introduced measures to improve the efficiency and transparency of tax administration, such as e-filing, faceless assessment, and reductions in corporate tax rates to encourage investment. Despite these efforts, challenges such as tax evasion, high litigation, and complex compliance processes persist. This paper reviews the evolution of tax reforms in India, evaluates their impact on economic growth, and discusses the challenges that remain. The study uses qualitative and quantitative analyses based on secondary data, policy documents, and empirical studies. The findings suggest that while tax reforms have improved revenue generation and economic efficiency, issues like compliance burdens and tax evasion remain. The study concludes with recommendations for simplifying the tax structure and strengthening enforcement mechanisms for a more effective tax regime.