‘New Income Tax Bill To Be Introduced In Monsoon Session,’ Says Finance Minister Nirmala Sitharaman
New Delhi: The new Income Tax Bill will be taken up for discussion in the Monsoon session of Parliament, Finance Minister Nirmala Sitharaman told the Lok Sabha on Tuesday.
The Income-tax Bill, 2025, which will replace the six-decade old Income Tax Act, 1961, aims to make direct tax laws simpler to understand, remove ambiguities, and reduce tax disputes.
The simplification exercise was guided by three core principles: textual and structural simplification for improved clarity and coherence; ensuring continuity and certainty with no major tax policy changes; and no modifications of tax rates to preserve predictability for taxpayers, the Finance Ministry said.
Based on global best practices, the Bill seeks to enhance the ease of doing business by providing a tax framework that is simple and clear. This has led to a substantial reduction in the Act’s volume, making it more streamlined and navigable.
The total number of words in the new Income Tax Bill has been reduced to 259,676 from a massive 512,535 words in the existing Income Tax Act — a nearly 50 percent reduction that resulted in cutting 252,859 words, according to an official statement.
Accordingly, the number of chapters has been reduced to 23 from 47 in the existing Act. Similarly, the number of sections has been cut to 536 from 819 earlier, removing as many as 283 sections.
This significant reduction was achieved by simplifying language to make the law more accessible and consolidating amendments to reduce fragmentation. A three-pronged approach was adopted, focusing on eliminating intricate language to enhance readability, removing redundant and repetitive provisions for better navigation, and reorganizing sections logically to facilitate ease of reference.
There has also been structural rationalisation through the use of tables and formulae for improved readability. While preserving existing taxation principles to ensure continuity, the Bill enhances usability, the statement added.
Consultations were held with industry experts and tax professionals, and simplification models from Australia and the UK were studied to incorporate best practices. The government ensured widespread stakeholder engagement, consulting taxpayers, businesses, industry associations, and professional bodies.
Out of 20,976 online suggestions received, relevant inputs were examined and incorporated where feasible.
(Except for the headline, this article has not been edited by FPJ’s editorial team and is auto-generated from an agency feed.)
https://www.freepressjournal.in/business/new-income-tax-bill-to-be-introduced-in-monsoon-session-says-finance-minister-nirmala-sitharaman
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