Thu Feb 13 10:45:28 UTC 2025: **New Income Tax Bill 2025 Introduced in Parliament Amidst Opposition Protests**

New Delhi, February 13, 2025 – Finance Minister Nirmala Sitharaman today introduced the much-anticipated New Income Tax Bill, 2025, in the Lok Sabha. The 622-page bill, which replaces the 60-year-old Income Tax Act of 1961, will come into effect on April 1, 2026. While the bill doesn’t introduce major tax changes, it aims to simplify the tax code by streamlining language and removing redundant provisions.

The new bill comprises 23 chapters, 536 sections, and 16 schedules, a significant increase from the 298 sections and 14 schedules of the previous Act. However, its overall length is considerably shorter (622 pages compared to 880 pages) due to the simplification efforts. Key changes include a shift from the previous “assessment year” concept to a single “tax year” approach for tax calculation. The bill also clarifies tax exemptions, including those for defense personnel’s gratuity and Agnipath scheme contributions, and maintains existing exemptions for home loans, medical expenses, and education loans.

The introduction of the bill was met with protests from opposition members, including Saugata Roy of the Trinamool Congress. Following its presentation in the Lok Sabha, the bill will proceed to the Rajya Sabha and subsequently to a parliamentary standing committee for review. The Finance Minister stated that the bill is intended to make direct tax laws easier to understand and will not impose any new tax burden.

Despite the government’s claim of simplification, some opposition members, such as Congress MP Manish Tewari, have suggested the new bill is actually more complex than its predecessor. A new, simplified tax calculator has been launched by the Income Tax Department to assist taxpayers in understanding the new regime. The bill also addresses the evolving financial landscape, incorporating definitions related to digital transactions and crypto assets.

The new Income Tax Bill 2025 aims to reduce tax disputes and litigation by using simpler language and a more concise structure. The bill’s text will be available on the Lok Sabha’s official website shortly.

Read More