Leveraging Digital India and changes in tax law for women’s empowerment

Marriage in India is a deeply entrenched social and religious institution that is evolving under modern influences. It functions as a sacred ceremony, a crucial societal methodology for family formation and property inheritance, and a legally recognised union of two souls. Marriage is not a one-size-fits-all institution in India. Personal laws specific to several religious communities, such as Hindus, Muslims, Christians, Sikhs, and Parsis, influence it.

The wedding industry in India

The scale of the wedding industry in India is huge and monumental across communities and religions; it has a religious and cultural significance in people’s lives and way of community living. Though it is a single big lifetime event for the families of both the bride and the groom, the brunt of most expenses is still traditionally borne by the bride and her family in a majority of the weddings in India; there is, however, co-sharing or partial sharing of expenses by the families in most educated and progressive communities in India.

The Indian wedding industry is a colossal market, estimated to be worth over $130-140 billion annually, driven by lavish celebrations, a high volume of weddings (around 8-10 million per year), and significant spending on aspects like jewellery, apparel, venues, and hospitality. Key trends include the growth of destination weddings, increased use of technology for planning, and a shift towards more personalised and experience-driven celebrations.

What is common across most Indian weddings:

• The girl’s parents and the girl (even if educated and earning) end up saving big for that one event called marriage where it’s obligatory to perform spends for a few rituals and customs in many communities and regions across India. The savings lifetime to spend on this ceremony often gets precedence over parental spending on the girl’s education/higher education and a reason for not usually allowing family capital to be transferred to the girl; many legal changes in recent decades, however, allow inheritance in ancestral property for girls even after marriage.

• Every wedding season comes with a high incidence of cash transactions, which essentially fails to curb incidence and practice of black money circulation if unchecked and can be split into categories: controllable and non-controllable.

UN SDG 5: Gender Equality

Goal 5 of the UN Sustainable Development Goals (SDGs) speaks about gender equality. Under Goal 5A, countries undertake reforms to give women equal rights to economic resources, as well as access to ownership and control over land and other forms of property, financial services, inheritance and natural resources, in accordance with national laws. Goal 5B seeks to enhance the use of enabling technology, in particular information and communications technology, to promote the empowerment of women.

A lot has been done by the Indian government in various initiatives in the past 11 years in particular, with schemes such as Beti Bachao Beti Padhao; Sukanya Samriddhi Yojana; Lakhpati Didi Yojana; Ladli Behna; doubling of maternity leave ; and steps to stop Triple talaq; and free bus rides etc, among others. Yet, the key issue of capital formation with women remains unaddressed and the event of a wedding ceremony presents an opportunity to empower women’s capital formation by tax law changes.

Women’s empowerment through digital India and tax law changes

Hence to mitigate cash transactions and unaccounted money in the wedding industry and help create capital for women, digital spends on marriages can be enforced through progressive changes and Incentives in the country’s Direct Tax laws, with a few checks and balances. The collateral impact being bringing a large stream of wedding vendors into the taxpayer base; tax on them will be determined in Year 1 of the spend done by the bride or her parents /relatives, while the government’s outflows would be on a lower scale through deduction benefits to women taxpayers. This will happen over 10 financial years and only after meeting some guidelines.

For finalising the tax deduction or incentive for digital payments and which can form the basis for women’s capital formation after marriage, its essential to also create a legal framework.

1. One marriage registration certificate, one marriage expense certificate norm to be established. The entire scheme applies only for the first marriage of any individual girl. Also, within the Muslim community, this deduction can be availed by only the first lawfully wedded wife (girl). The scheme applies only when the girl is 21 years of age at the time of marriage.

2. Marriage expense certificate to be linked to Aadhar and PAN card of bride with PAN and Aadhar number of immediate parents of bride or two blood relatives of bride (within the definition of relative as defined under income tax law, if immediate parents have expired) who can incur expenditure to “Wedding vendors” through only Digital mode. This certificate is to be uploaded on the income tax portal after linking these numbers between the stakeholders electronically and called as “Marriage spend certificate”. Such certificate must be got certified by a practising CA with UDIN and notarised, for filing on the income tax portal under income tax forms. Through the certificate upload mechanism, the parents’ expenses will get clubbed with the bride’s own for calculating the deduction benefit order. The parents or relatives of the bride will not be able to claim any deduction and their spends must be transferred to the girl’s PAN through the income tax portal.

3. Open a facility for ‘wedding vendors’ to obtain a TCS number on the income tax portal to collect TCS of 0.1% for such wedding payments. The control here is: If the TCS is not collected by the wedding vendor, then in that event the bride and family cannot claim the expense on the tax portal. And the government stands to gain if wrongly collected by the vendor outside of marriage event.

4. All service providers who operate as ‘wedding vendors’ in India to get a TCS collection facility through a suitable subsection inserted in section 206(C ) of the Income Tax Act 1961, (OR Chapter XIX of Income Tax 2025) wherein these vendors would collect a TCS at source on their invoices paid digitally only through UPI, net banking or cards by the bride or her parents through their bank accounts designated so with their PAN and Aadhaar KYC. This TCS will reflect in the AIS /26AS statement of the bride or her parents/ specified relatives, paying on her behalf for Marriage expenses. The CA certificate filed will be verified by an independent notary and notarised for being available to upload. Each such marriage certificate must be uploaded on the income tax portal within 90 days of solemnising/registration of marriage.

5. Once all vetting is done by the income tax department, within 30 days of submitting such audited expense certificate, the department can pass a ‘deduction allotted order’ in the PAN of the bride in similar fashion like a 143(1A) order with suitable rules for appeal and revised filing allowed once.

6. If income is not declared by the girl (bride) in any financial year after marriage, the deduction also cannot be availed and will be carried forward to the next financial year but not beyond 10 financial years after the financial year in which the marriage is solemnised. Marriage expense deduction is allowed only against taxable income of the girl (bride) under a specific section and basis the table below.

7. Claim for deduction can be made only by the (girl) bride in her tax return initially and later co-share with the husband, after three financial years after the date of registration of marriage mentioned in the expense certificate. If the marriage is solemnised in FY26, the deduction is to be allowed for subsequent 10 financial years starting FY27 on a proportion given in the table below. The transfer can happen through the income tax portal to the husband as according to table below and at each financial year at the discretion of the wife.

8. This deduction to be allowed in increasing proportion for 10 financial years in following fashion. Year 1 is the financial year succeeding the financial year in which the marriage is solemnised. The bride (wife) must file a consent form on the income tax portal for co-sharing with husband. In the event that no such consent form is filed for a financial year, the bride will get the full deduction herself for that financial year when applicable after the third year.

9. This deduction is allowed under even the new default regime u/s 115 BAC (u/s 202 of ITA 2025) limited to the total amount allowed in the category of taxpayers, after the marriage is registered and only provided there is no divorce, separation or talaq filed by the bride or any criminal case u/s 498 of Indian Penal Code or corresponding section 85 or 86 of Bhartiya Nyaya Sanhita 2023 by her against the husband.

If during these 10 financial years any of this incidence happens, the deduction shall stand withdrawn for co-share from husband:

• In the event of unnatural death of the bride (girl) during the sustenance of the marriage, no deduction will be transferred to the husband or the child born out of the marriage;

• Even in case of natural death, the deduction will be held by the husband in trust for the child born out of the wedlock, and on the completion of 18 years of the child, the same will be given to the child for claiming a refund from the income tax department for the purpose of higher education.

10. Total deduction to be allowed is up to max ₹10 lakh or 50% of the spend on the marriage done through digital mode to the ‘wedding vendors’, whichever is lower for salaried taxpayers and where the bride or her parents have never declared income from business or profession.

11. Higher deduction will be allowed to bride and her parents/relatives, who declare higher income from business and profession for three continuous financial years before the financial year in which the marriage is solemnised and where the tax paid is in equal to or in excess of ₹100 lakh in the year preceding the financial year in which the marriage is solemnised either by the bride or her parents /specified relatives. This deduction will be up to a max of: a) ₹25 lakh; or b) 50% of actual spend through digital mode to ‘wedding vendors’ but not exceeding; c) 25% of the tax paid in the previous financial years.

Provisions of section 56 of the Income Tax Act 1961 (Section 92 of Income Tax 2025) will govern other gifts including gold, jewellery, etc.

For cross border spends to qualify for deduction, the above limits will apply only for spends done through Indian credit cards, provided the remittance of such card dues is made in ₹.

In conclusion, this reform will help women’s empowerment by providing the women a capital asset in form of tax deduction available and reduce the menace of dowry and black money circulation, with the added benefit of increasing the taxpayer base as the trend will be to pay marriage expenses digitally instead of cash.

(The author is a chartered accountant. Views are personal.)