Project Insight 2.0 set for 2028 launch to speed up tax refunds

The Finance Ministry plans to go live with Project Insight 2.0 from January 27, 2028, a mechanism that uses AI to separate genuine income tax filings from suspicious ones. The Ministry told a Parliamentary panel that the system is expected to reduce delays in refunds, which have worsened in recent years.

Data cited by the Ministry shows the average delay for a refund rose to 35 days in FY26 (as on January 31) from 24 days in FY24. The number of refunds issued after 90 days jumped to about 27 lakh in FY26 from 12.73 lakh in FY24.

The Ministry attributed current delays to two sets of issues: mandatory holds such as unlinked PAN and Aadhaar or unvalidated bank accounts, and system-flagged risks including bogus deduction claims. Project Insight 2.0, still under development, will deploy AI-driven risk scoring and predictive models to flag fraudulent claims while letting genuine filings pass faster.