Tax Reforms in India: Evolution, Impact and Future Prospects (1961–2025)

Abstract

Tax reforms in India have been a continuous process shaped by economic goals, fiscal consolidation, compliance challenges, and global trends. This paper systematically analyzes reforms in India’s direct and indirect tax systems — focusing on the Income-tax Act of 1961, structural changes across decades, the landmark introduction of the Income Tax Act, 2025, and changes in indirect taxes like GST. Using historical context, policy analysis, numerical trends, and conceptual diagrams, this study assesses the efficacy of reforms in revenue mobilisation, taxpayer base expansion, and compliance simplification.