A PIB fact check has debunked the claim that the income tax department tracks online shopping, digital payments, app-based transactions and or any form of personal spending behavior of Indian citizens.
In a fact check, it is clarified that there is no mechanism to monitor an individual’s digital or online activity, denying the claims made by a content creator for accessing emails, social media, trading apps and private accounts.
However, there are some provisions such as Search and Survey operations under Section 247 of the Income Tax Act, 2025 that allows income tax department to access private digital spaces of an individual. It can happen only in case of evidence of serious tax evasion, and a formal search is initiated.
The PIB fact check clarified that these powers cannot be used for routine data collection, scrutiny assessments, or general monitoring. They are meant to tackle black money and large-scale evasion. In fact, the power of authority to seize documents during search and survey has existed since the Income Tax Act, 1961.
There is a provision under Section 285BA of the Income Tax Act, 1961 that deals with high-value transactions. PIB fact check said that reporting under the above section doesn’t involve surveillance.
The Statement of Financial Transactions (SFT) framework requires specified entities (banks, registrars, etc.) to report limited high-value transactions as part of routine compliance. These provisions have existed for years and do not involve behavioural profiling or online activity monitoring.
An Instagram post by ‘bingewealth’ claims that the Income-tax Department (ITD) tracks people’s personal digital activity, online spending, or lifestyle.#PIBFactCheck
❌ This claim is #misleading! Here’s the real picture:
✅ The Income-tax Department does NOT track online… pic.twitter.com/Q42ZMJLic5
— PIB Fact Check (@PIBFactCheck) January 2, 2026
The Income-tax Act, 1961, the principal law governing direct taxes for generations, is being replaced by the Income-tax Act, 2025. The changes for taxpayers begin with the financial year 2025-26, effectively impacting tax returns filed from April 1, 2026, onward.
The 1961 Act, despite periodic amendments, had grown into a complex and cumbersome statute with over 800 sections and decades of layered interpretations. The Government of India undertook a comprehensive overhaul to make tax law simpler, more precise, technology-ready and suited to the 21st-century economy. The new legislation consolidates redundant provisions, removes obsolete language, and brings clarity to key areas of compliance.
