Central Board of Direct Taxes (CBDT) - UPSC Notes

The Central Board of Direct Taxes (CBDT) is the authority vested with the responsibility of the administration of laws related to direct taxes through the Department of Income Tax. In India, necessary inputs for policy and planning are provided by the CBDT. Students preparing for IAS Exam should be aware of this topic.

The Central Board of Direct Taxes can be related to ‘Indian Economy’ in the General Studies Paper-3 section of the UPSC Syllabus.

Central Board of Direct Taxes Latest News (April 2023)

The Union Finance Minister Nirmala Sitharaman chaired a review meeting with the Central Board of Direct Taxes (CBDT), that discussed the taxpayer base, and new TDS codes among other issues.

News in detail:

  • The review meeting mainly focussed on:
    • Increasing taxpayer base
    • Pending disciplinary proceeding cases
    • Disposal of applications for condonation of delay
    • Grant of exemptions under certain sections of the Income Tax Act, 1961
  • It discussed how the introduction of new data sources in Statement of Financial Transactions (SFT) and information from GSTN has resulted in a 1118 per cent rise in reported information leading to the addition of information of about 3 crore persons.
  • Moreover, the introduction of new TDS codes also resulted in an increase in total reported transactions in 2021-22 to 144 crore as compared to 70 crore in 2015-16.
  • It also discussed the Personal Income Tax (PIT) to GDP ratio increased from 2.11 in 2014-15 to 2.94 in 2021-22.

Way forward: As suggested by the FM, the CBDT should expand and strengthen its efforts to increase awareness among the taxpayers about the provisions of the direct tax laws and their compliance to achieve intended results.

Every time you attempt the CSAT Mock Tests, you get closer to your ultimate goal of cracking the IAS Exam. Visit the page now!!

Candidates can check the following links to strengthen their UPSC preparation:

What is the Central Board of Direct Taxes (CBDT)?

  • It is a statutory body established as per the Central Board of Revenue Act, 1963.
  • It is India’s official financial action task force unit.
  • It is administered by the Department of Revenue under the Ministry of Finance.

To note is that originally there was a board called the Central Board of Revenue that functioned as the apex body of the Income Tax Department. The said board was set up under the Central Board of Revenue Act, 1924 and was in charge of both direct and indirect taxes. The Central Board of Revenue got split in 1964 into two boards:

  1. Central Board of Direct Taxes
  2. Central Board of Excise and Customs

Learn about Taxation in India from the linked article.

CBDT Structure

The Central Board of Direct Taxes consists of a Chairman, and six members that deal with the following:

  • Income Tax & Revenue
  • Administration
  • Legislation 
  • Audit and Judicial
  • Investigation
  • TPS & System

The Members of the CBDT are selected from the Indian Revenue Service (IRS). The members constitute the top management of the Income Tax Department.

Functions of CBDT

  • It deals with matters related to levying and collecting Direct Taxes.
  • Formulation of various policies.
  • Supervision of the entire Income Tax Department
  • Suggests legislative changes in Direct Tax Enactments
  • Suggests changes in tax rates 
  • Proposes changes in the taxation structure in line with the Government policies.

Central Board of Direct Taxes (CBDT):- Download PDF Here

Indian Economy plays an important role in UPSC Preparation as it can be associated with other topics like International Relations and Current Affairs.

For more UPSC related preparation materials and articles, visit the links given in the table below:

Related Links:

Value-Added Tax (VAT)  Goods and Service Tax (GST)
Minimum Alternate Tax (MAT) Direct Tax Code
Direct Tax Avoidance Agreements Tax Policy Council & Tax Policy Research Unit


Leave a Comment

Your Mobile number and Email id will not be published.