Finance Ministry Exempts UIDAI’s Income from Income Tax for Five Years
The finance ministry has announced the exemption of the Unique Identification Authority of India (UIDAI) from paying income tax for a period of five years until fiscal year 2027-2028. This exemption encompasses various sources of income for UIDAI, including grants/subsidies from the central government, fees/subscriptions (such as RTI fee, tender fee, sale of scrap, PVC card), as well as authentication, enrolment, and updation service charges. Additionally, income from term/fixed deposits and interest on bank deposits earned by UIDAI will also be exempt from income tax.
The Central Board of Direct Taxes (CBDT) under the Ministry of Finance issued a notification outlining the applicability of this exemption for the assessment years 2024-2025, 2025-2026, 2026-2027, 2027-2028, and 2028-2029. As a statutory authority established under the provisions of the Aadhaar Act, 2016, UIDAI’s primary responsibility is to ensure compliance with the act, as well as to establish regulations and rules consistent with its provisions.
However, it is imperative to note that this exemption is contingent upon certain conditions. UIDAI must refrain from engaging in any commercial activities, and the nature of the specified income should remain consistent throughout the financial years covered by this notification.
This significant decision by the finance ministry underscores the crucial role played by UIDAI in upholding the Aadhaar Act and ensuring the seamless functioning of the unique identification system in India.
