For the first time since April 1, 2026, the Income Tax Department will be allowed to search through the emails of taxpayers, their social media accounts and digital transactions if there are reasons to believe that the client is trying to pay taxes or has undisclosed property. This is the first time such a step has been taken as per Section 247 of the Income Tax Bill 2025 and has received a good deal of backlash concerning privacy issues.
When it comes to the rule, Mohandas Pai, the former Infosys CFO, had a major issue and called it an ‘attack on our rights’. He also posted his concern on X, social media, suggesting the government to include provisions to prevent abuse and for tax officers to need a warrant to search through people’s private details.
The new tax legislation enables authorised officers to bypass the access codes to access virtual digital facilities like banks accounts, online investments and e-mails when a taxpayer is believed to be trying to conceal income, cash, gold or any other form of value. Legal practitioners are concerned that social media posts indicating unnecessary expenditure of money may attract the attention of tax authorities where the declared income is not correct.
This step according to experts in tax advisory means that the tax departmental examination is now extended to the virtual world and this is the first time in India’s direct taxes. The government has explained that this measure will help in the fight against tax evasion and black money, however, opponents are concerned with abuse and invasion of people’s privacy.
“As such, there are no rules in place to check such powers, and this may lead to selective and malicious scrutiny and harassment,” said Alay Razvi, Managing Partner, Accord Juris. Experts have recommended the need for judicial oversight to prevent abuse of the system while real tax fraud is also addressed.
As the discussion progresses, many people are advising the Finance Ministry to review the provisions and put legal measures in place before the new tax provision can be implemented.
