The Income Tax Department has awarded a ₹792-crore contract to LTIMindtree for the development and implementation of PAN 2.0, a next-generation AI-powered digital identity platform aimed at transforming tax services in India. The project, announced this week, seeks to unify and modernise Permanent Account Number (PAN)-related services, enabling faster, more transparent, and more user-friendly access for individuals and businesses.
A Unified Digital Tax Identity
The PAN 2.0 initiative is designed to replace the existing fragmented system with a centralised platform that integrates all PAN services — from application and updates to linking with Aadhaar, filing returns, and compliance tracking.
According to the Income Tax Department, the new system will also incorporate advanced fraud detection and verification mechanisms using AI and machine learning, significantly reducing errors, duplication, and identity theft risks.
The rollout is expected to be completed within 18 months, after which taxpayers will be able to access all PAN-related services through a single interface.
AI at the Core of PAN 2.0
The new platform will use natural language processing for multilingual support, enabling citizens to interact in regional languages. AI-driven analytics will help authorities track compliance trends and detect anomalies in real time.
Officials said the system would also provide predictive assistance — guiding users through filing and compliance processes based on their financial profiles, reducing the need for in-person visits and manual interventions.
LTIMindtree’s Role
LTIMindtree will handle the platform’s end-to-end design, development, and deployment, including integration with existing government databases and cloud infrastructure.
The IT services firm, which has prior experience in large-scale public sector digitisation projects, said PAN 2.0 would set “a new benchmark in citizen-facing tax technology.”
“Our goal is to create a system that’s not just compliant but also citizen-friendly, reducing the friction between taxpayers and authorities,” said an LTIMindtree spokesperson.
Driving Transparency and Compliance
The Income Tax Department has stated that PAN 2.0 will promote greater compliance by making the process simpler and more accessible. Tax experts believe the platform could boost voluntary tax filings, especially among small businesses and gig workers, by making the process less cumbersome.
Furthermore, with AI’s capability to detect irregularities, the department expects to reduce tax evasion risks while also enabling faster dispute resolution.
Digital India Push
This move aligns with India’s Digital India initiative, which aims to bring more government services online, increase accessibility, and improve efficiency.
In recent years, the country has seen similar AI-led transformations in passport services, GST filings, and railway ticketing systems. PAN 2.0 marks the next major leap in tax technology.
If successful, the model could inspire similar digital identity upgrades in other government departments, paving the way for a single, AI-backed citizen identity interface in the future.