In a significant move for taxpayers, the Lok Sabha has successfully passed the Finance Bill 2025 today. Finance Minister Nirmala Sitharaman announced earlier that the highly anticipated new Income Tax Bill will be discussed during the upcoming monsoon session of Parliament. This session is expected to commence in July and continue into August, bringing important changes to the existing tax framework.
Overview of the Income Tax Bill 2025
During the Lok Sabha discussions, Sitharaman highlighted that the new Income Tax Bill, introduced on February 13, is currently under review by a designated Select Committee. This committee has been tasked with delivering its report by the first day of the next parliamentary session, ensuring that lawmakers have ample information for the upcoming discussions.
Key Features of the New Income Tax Bill
The Income Tax Bill 2025 aims to streamline the tax process, making it less cumbersome for taxpayers. Here are some of the notable changes:
- Size Reduction: The new bill is significantly more concise, containing 2.6 lakh words compared to the 5.12 lakh words of the 1961 Income Tax Act.
- Fewer Sections: It features 536 sections, a reduction from the 819 sections currently in effect.
- Chapters Halved: The number of chapters has been cut down from 47 to 23, simplifying the structure.
- Increased Tables: The new bill includes 57 tables, an increase from just 18 in the existing act.
- Removal of Redundancies: Over 1,200 provisos and 900 explanations have been eliminated, aiming for greater clarity and reduced litigation.
Moving Towards Tax Certainty
This revamped legislation is designed to enhance tax certainty and minimize the potential for disputes and misinterpretations, as emphasized by the Income Tax Department. By simplifying the tax framework, the government aims to create a more efficient system that benefits both taxpayers and the administration.
As discussions progress and the Select Committee finalizes its recommendations, the upcoming monsoon session will be pivotal for shaping the future of taxation in India. Stay tuned for developments as this new legislation promises to redefine the financial landscape for millions.
