New Delhi, Feb 13 (IANS) - Finance Minister Nirmala Sitharaman presented the new Income Tax Bill, 2025, in the Lok Sabha on Thursday to streamline and simplify tax provisions, aiming to reduce legal disputes.
The legislation will replace the extensive Income Tax Act, 1961, which has undergone numerous modifications over six decades, resulting in complexity.
The Bill will be referred to the Select Committee of Parliament before final approval, with the new law expected to be effective from April 1, 2026.
The Budget Session of Parliament concluded on Thursday, to resume on March 10 in two parts - January 31 to February 13 and March 10 to April 4.
The primary goal of the new Income Tax Bill is to simplify tax laws, ensuring transparency, ease of interpretation, and taxpayer-friendliness. It aims to replace complex provisions with clearer ones to reduce disputes and enhance tax compliance.
The bill may introduce lower penalties for certain offenses, making the tax system more user-friendly.
The Income Tax Bill will be condensed to 622 pages with 536 clauses, replacing the current 64-year-old law containing 823 pages and 819 sections. It will simplify language and eliminate convoluted provisions for better comprehension and reduced legal disputes.
The bill will maintain existing tax slabs and rebates, focusing on reader-friendly legislation rather than altering tax structures.
Rohinton Sidhwa, Partner at Deloitte India, states, "This reform modernizes India's tax framework, bringing clarity and efficiency. The bill promises a streamlined, accessible tax system for citizens and businesses, fostering trust."
