PAN 2.0 Project revolutionises business identification in India

November 30, 2024 Finance Talk Valli Sarvani

The PAN 2.0 Project, spearheaded by the Indian Income Tax Department, is an ambitious initiative to modernize the Permanent Account Number (PAN) system.

With a budget of ₹1,435 crore, this project aims to establish PAN as a common business identifier (CBI), consolidating TAN, TIN, and other identifiers into a unified system across government platforms.

Key Features and Benefits of PAN 2.0

Unified Digital Portal

The project introduces a single online platform for all PAN-related services, streamlining access and reducing paperwork for businesses.

Enhanced Security

The new PAN cards will feature QR codes and PAN Data Vaults to strengthen data security and simplify validation processes.

Eco-Friendly and Efficient Services

PAN 2.0 promotes paperless operations, offering faster and cost-effective taxpayer services with robust grievance redressal mechanisms.

Improved Data Accuracy

By integrating all identifiers under one system, PAN 2.0 will act as a “single source of truth”, ensuring data consistency across platforms.

Minimized Duplicates

Advanced algorithms will detect and reduce duplicate PANs, with holders required to deactivate additional PANs per the Income-tax Act, 1961.

QR Code Validation

Since 2017-18, PAN cards have included QR codes. PAN 2.0 expands this feature, allowing quick validation of details through a specific reader application.

Impact on Businesses

Businesses will significantly benefit from reduced documentation as PAN serves as the universal identifier for interactions with government agencies, financial institutions, and state departments. This improvement will enhance coordination and reduce administrative burdens.

Existing PAN holders need not apply for a new PAN. Current cards remain valid, though holders of older cards without QR codes may request an upgrade optionally.

Upgraded e-PANs will be delivered to registered email addresses for free, while physical cards will incur nominal delivery charges.

With 78 crore PANs issued so far, including 98% for individuals, PAN 2.0 marks a significant leap toward modernizing India’s tax and business identification systems.

The rollout timeline and detailed application process are awaited, but the project is set to simplify governance and improve user experiences.

Image from Pxhere (Free for commercial use / CC0 Public Domain)

Image Published on March 17, 2017