The new income tax bill has recently been in the news, and not for the reasons taxpayers would hope. While the government said it’s all about simplifying tax laws, buried within the bill is a provision that hands sweeping powers to tax authorities allowing them to dig through emails, trading accounts, social media profiles, and more during tax investigations.

Finance Minister Nirmala Sitharaman introduced the revamped Income Tax Bill, 2025, in Parliament, calling it an overhaul of the six-decade-old tax framework. But before it becomes law, a select committee will review it. And the key concern is a clause that expands the scope of tax searches beyond what’s currently allowed to include “virtual digital spaces”

Right now, tax officers can ask for access to laptops, hard drives, and emails, but since the current tax law doesn’t explicitly mention digital records, such demands often face legal pushback. However, the new bill makes it clear: tax authorities can demand access to digital assets, and if a taxpayer refuses, they can bypass passwords, override security settings, and unlock files.