UNION BUDGET 2026-27 ANNOUNCES DIRECT TAX PROPOSALS FOR RATIONALIZING PENALTY AND PROSECUTION

• Set of Direct Tax proposals in Union Budget 2026-27 (presented 01 Feb 2026 by FM Nirmala Sitharaman) aimed at rationalizing penalty and prosecution under the Income-tax Act, 1961.
• Twin thrust: ease of doing business (integration of proceedings, reduced litigation) and decriminalisation of minor/technical offences.
• Relevant for UPSC: intersects GS-II (governance reforms, decriminalisation drive) and GS-III (taxation, fiscal policy, ease of doing business).