Thu Feb 13 07:02:23 UTC 2025: ## New Income Tax Bill Introduced in Indian Parliament

**New Delhi, February 13, 2025** – The much-anticipated Income Tax Bill, 2025, was introduced in the Lok Sabha today by Union Finance Minister Nirmala Sitharaman. The 622-page bill aims to replace the 60-year-old Income Tax Act of 1961, streamlining India’s direct tax system. The bill, approved by the Cabinet on February 7th, is intended to simplify tax laws and reduce compliance burdens for both taxpayers and administrators.

Key features of the new bill include:

* **Simplified Language and Structure:** The bill features simpler language, eliminating outdated provisions and reducing the number of sections by an estimated 25-30%. Terms like “previous year” and “assessment year” have been replaced with “tax year,” clarifying tax terminology.
* **Increased Tax Exemption Limit:** A significant change is the raised exemption limit for nil tax liability. Salaried individuals earning up to ₹12.75 lakh per annum (including a standard deduction of ₹75,000) will not be liable for income tax, benefiting the middle class.
* **Revised Tax Slabs:** The new tax regime introduces revised tax slabs with lower rates, although limited deductions and exemptions are permitted compared to the old regime, which remains an option for taxpayers.
* **Extended Filing Window:** The period for filing updated income tax returns has been extended from two to four years, allowing more time for corrections.

While the government touts the bill’s simplification, some opposition members, such as Congress MP Manish Tewari, have expressed concerns about its complexity. Conversely, BJP MP Tejasvi Surya praised the government’s efforts in modernizing India’s tax system.

After Lok Sabha approval, the bill will be sent to the Parliament’s Standing Committee on Finance for review and consultation before returning to Parliament for final passage. The new Income Tax Act, 2025, is expected to come into effect in April 2026. The bill also addresses concerns raised by professionals regarding the 44AD/44AE/44ADA issue and clarifies the taxation of virtual digital assets.

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