New Income Tax Bill Introduced in Lok Sabha

The New Income Tax Bill Introduced , 2025, was officially introduced in the Lok Sabha on February 13, 2025, by Finance Minister Nirmala Sitharaman. This bill aims to replace the Income Tax Act, 1961, which had become cumbersome due to numerous amendments over the past six decades. The introduction of the new income tax bill faced resistance from opposition parties, but the motion was passed through a voice vote.

Key Highlights of the New Income Tax Bill 2025

Simplified Terminologies:
- The term “previous year” will be replaced with “tax year”.
- The concept of “assessment year” has been removed to reduce complexity.
Increased Number of Sections:
- The new income tax bill 2025 contains 536 sections, compared to 298 sections in the Income Tax Act, 1961.
- The number of schedules has also increased from 14 to 16.
Easier Compliance:
- The bill aims to simplify tax laws and improve transparency in compliance procedures.
- Taxpayers will find it easier to understand and comply with the provisions.
Replacement of Assessment Year System:
- Currently, taxpayers file returns for income earned in the previous year in the assessment year (e.g., income earned in 2023-24 is assessed in 2024-25).
- Under the new system, only the tax year will be considered.
Lok Sabha Debate & Opposition’s Stand:
- Opposition parties objected to the introduction of the income tax bill, citing concerns over implementation and lack of consultation.
- However, the Lok Sabha Speaker Om Birla allowed the introduction and moved it to the Select Committee for further examination.

How Will This Impact Taxpayers?

The new income tax bill introduced in Lok Sabha is expected to make tax filing simpler and more efficient. With a streamlined structure and updated terminology, it seeks to eliminate ambiguity and confusion. The removal of the assessment year concept is one of the most significant changes, as it aligns India’s taxation system with international standards.

Don’t Miss:

Download New Income Tax Bill 2025 PDF

For taxpayers and professionals seeking detailed insights, the Income Tax Bill 2025 PDF will be available on the official government portal after the final approval.

What’s Next?

The Lok Sabha has been adjourned and will reconvene on March 10, 2025, for the second half of the Budget session. During this session, the bill will be discussed in detail before moving towards approval.

Conclusion

The introduction of the new income tax bill marks a significant reform in India’s taxation system. While it faces opposition, the government maintains that it will bring clarity and ease tax compliance for individuals and businesses alike. As the bill progresses in Parliament, taxpayers should stay informed about upcoming changes to ensure a smooth transition.