CBDT has issued an order under Section 258(1) of the Income-tax Act, 2025, authorising secure sharing of income-tax information with the Government of Andhra Pradesh. The purpose is to identify eligible beneficiaries for state welfare schemes, ensuring that subsidies and entitlements reach only those below prescribed income thresholds. This marks a significant use of tax data as a governance tool, linking revenue administration directly to targeted welfare delivery at the state level.

Section 258(1) of the Income-tax Act, 2025 — the consolidated successor to the Income-tax Act, 1961 — empowers CBDT to authorise disclosure of taxpayer information to specified government agencies for defined public purposes. Ordinarily, income-tax data is strictly confidential under law. This order creates a controlled exception: Andhra Pradesh's welfare machinery can now cross-reference applicants' tax filings to verify income eligibility before granting scheme benefits.

The policy logic is Direct Benefit Transfer (DBT) refinement. India has long struggled with inclusion and exclusion errors in welfare delivery — ineligible beneficiaries capturing benefits while genuine poor are left out. Using income-tax return data as a negative filter (excluding those above the income ceiling) tightens targeting without requiring a new verification bureaucracy.

For competitive exam aspirants, the intersection here is threefold: (1) the legal mechanism — Section 258(1) of the new IT Act, 2025 — is a testable statutory provision; (2) the institutional actor — CBDT under the Ministry of Finance — is the nodal authority for tax administration; and (3) the governance objective — welfare beneficiary identification — connects to India's broader JAM (Jan Dhan–Aadhaar–Mobile) trinity and data-sharing architecture. NABARD aspirants should note the rural-welfare dimension; UPSC aspirants should see the federalism angle — a central tax body enabling a state welfare programme through data federalism.