The Institute of Cost Accountants of India (ICMAI) has formally urged the Lok Sabha’s Select Committee to amend the Income Tax Bill, 2025, by explicitly including "Cost Accountant" within the definition of "Accountant" under Section 515(3)(b). This request comes as part of a broader effort to modernize and enhance India’s direct taxation system, ensuring that cost accountants receive due recognition for their role in financial management and compliance.
The Income Tax Bill, 2025, which was introduced in Parliament on February 13, seeks to revamp India’s six-decade-old taxation framework by simplifying provisions, reducing legal disputes, and promoting voluntary compliance among taxpayers. While ICMAI has welcomed the proposed legislative changes, it has strongly emphasized the need to expand the definition of "Accountant" to provide a more inclusive and comprehensive representation of professionals who contribute to the taxation and compliance landscape.
In its memorandum to the Select Committee, ICMAI has highlighted the extensive expertise of cost accountants, arguing that their academic and professional training makes them highly competent to handle taxation matters. The Cost and Management Accounting (CMA) curriculum covers a broad spectrum of subjects, including direct and indirect taxes, GST, corporate taxation, financial and cost accounting, banking, auditing, information technology, risk management, strategic financial planning, corporate laws, and professional ethics. ICMAI asserts that CMAs possess the necessary technical knowledge and analytical skills required for tax compliance, financial assessments, and regulatory reporting.
The institute has also underscored the significant role that cost accountants already play in corporate governance and financial management. Under the Companies Act, 2013, CMAs are officially recognized as internal auditors, and they are authorized to conduct statutory financial audits under various state laws. Additionally, cost accountants are actively involved in forensic auditing, risk assessment, financial restructuring, and performance evaluation for businesses across sectors. Given this vast domain expertise, ICMAI argues that cost accountants should be formally recognized as qualified professionals for tax-related functions under the new tax regime.
A key point raised by ICMAI is that tax audits under the current Income Tax Act are primarily concerned with compiling and analyzing tax-related data from audited financial statements. Since cost accountants are already trained and experienced in evaluating financial records, conducting compliance checks, and advising on taxation matters, the institute believes that excluding them from the definition of "Accountant" would be an oversight. ICMAI asserts that allowing cost accountants to participate more actively in tax-related functions will strengthen compliance mechanisms and improve tax administration by bringing in a wider pool of professionals with expertise in financial assessment and reporting.
By advocating for this amendment, ICMAI aims to ensure greater inclusivity and fairness in the taxation framework, providing cost accountants with the opportunity to contribute meaningfully to India's evolving tax system. The institute believes that recognizing CMAs as accountants within the Income Tax Bill, 2025, will enhance transparency, boost compliance rates, and safeguard revenue collection for the exchequer. Furthermore, ICMAI argues that a more diverse representation of accounting professionals in the tax domain will lead to a more robust and efficient financial governance system in the country.
ICMAI's demand comes amid ongoing discussions about the future of India’s tax policy and the need for greater professional participation in tax compliance and regulatory functions. As the Select Committee reviews the bill and considers potential amendments, ICMAI remains hopeful that its recommendations will be taken into account, ultimately leading to a more balanced and inclusive taxation framework that leverages the expertise of cost accountants alongside other financial professionals.
