The new income tax bill, which will replace the 60-year-old I-T Act, was adopted by the Union Cabinet on Friday, February 7, 2025, according to sources. The goal of the new bill is to simplify direct tax law without adding further tax burdens. It won’t contain lengthy sentences, provisos, or explanations.
According to sources, the New Income Tax Bill was passed by the Cabinet, which is led by Prime Minister Narendra Modi. According to sources, the revised income tax measure will now be referred to the Standing Committee on Finance of Parliament after being introduced in the legislature next week. February 13, 2025, marks the conclusion of the current budget session’s first leg. The meeting will meet again on March 10 and continue until April 4.
In Budget 2025–2026, Finance Minister Nirmala Sitharaman declared that the new tax bill would be presented during the current legislative session. In the July 2024 Budget, Ms. Sitharaman first declared that the Income-Tax Act, 1961 would be thoroughly reviewed.
To supervise the evaluation and make the Act clear, succinct, and easy to comprehend, the CBDT established an internal committee. This will decrease disagreements and lawsuits and give taxpayers more tax certainty. Additionally, 22 specialized subcommittees have been formed to examine the many facets of the Income Tax Act.
Four types of public input and proposals were solicited: redundant/obsolete provisions, litigation reduction, compliance reduction, and language simplification. Stakeholders have submitted 6,500 suggestions to the income tax administration for the review of the Income Tax Act.
