Government Revises Tax Rules Increasing Allowance Complexity

The government released the draft Income-tax Rules, 2026 for public consultation, with implementation planned from April 2026. The draft consolidates rules (511→333) and forms (399→190) and introduces extensive pre-filled returns, but also raises several salary allowances and reclassifies metros, lifting the HRA cap to 50%. These changes may alter Old vs New tax regime choices and increase demand for professional advice.