TAXATION LAW IN INDIA: CONSTITUTIONAL PROVISIONS, DIRECT AND INDIRECT TAXES, AND EMERGING REGIMES OF REFORM

The Indian taxation system is deeply rooted in constitutional mandates and has evolved into a complex framework balancing revenue generation with socio-economic objectives. The Constitution of India clearly demarcates the powers of the Union and State governments to levy and collect taxes, providing a federal structure to taxation. Direct taxes, such as income tax and corporate tax, play a significant role in progressive wealth redistribution, while indirect taxes, historically fragmented across multiple statutes, were consolidated through the introduction of the Goods and Services Tax (GST). This transformation marked one of the most comprehensive tax reforms since independence, aiming to create a unified national market and reduce cascading effects of taxation. Despite these advancements, challenges such as compliance burdens, digital taxation, and ensuring equity in resource mobilization persist. Additionally, global trends in base erosion, profit shifting, and the rise of the digital economy are influencing India’s reform agenda. Recent regimes of reform focus on rationalizing tax rates, leveraging technology for transparency, and enhancing taxpayer services to foster voluntary compliance. This study examines constitutional provisions, the coexistence of direct and indirect taxes, and the trajectory of emerging reforms to highlight the dynamic interplay between law, economy, and governance in shaping tax policy in India.