Several industry associations and business chambers across India have formally appealed to the Income Tax Department seeking relief from stringent TAN (Tax Dedication and Collection Account Number) compliance norms, especially for small and medium enterprises (SMEs), startups, and sector-specific organizations. Citing growing administrative and financial pressures, the associations argue that the current system places a disproportionate burden on smaller entities that often lack the infrastructure to manage complex TDS/TCS obligations effectively.

The representation highlights issues such as frequent portal errors, difficulty in digital signature integration, rigid filing deadlines, and hefty penalties for minor delays or clerical mismatches in PAN-TAN entries. They have urged the government to consider grace periods, simplified return formats, waiver of late fees for first-time or low-value defaulters, and technical support for navigating the TRACES and NSDL platforms. There is also a call for clearer exemption guidelines for businesses that operate below the TDS threshold but still receive TAN notices due to legacy data.

In response, senior tax officials have acknowledged the concerns and assured stakeholders that the department is reviewing compliance policies for proportionality and fairness. A working group may be formed to evaluate the feasibility of sector-specific relaxations and to streamline TAN-linked processes without compromising revenue objectives. This demand for relief reflects the broader tension between regulatory compliance and business ease, particularly in a rapidly digitizing tax ecosystem where uniform standards must balance operational realities across varied business profiles.