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PremiumNew Income Tax Bill 2025 Highlights: The Union Cabinet approved the new Income Tax Bill on Friday, February 7, 2025. The new direct tax code is expected to be introduced in the Lok Sabha this week. The new tax bill is part of a larger effort to reform the country's tax system and aims to overhaul the existing tax structure to make it more streamlined and transparent.
Also Read: New Income Tax Bill: 10 Key points every taxpayer must know
The Union Cabinet, chaired by Prime Minister Narendra Modi, had approved the new Income Tax bill last week, news agency PTI reported, citing sources. The bill will now be presented in the Parliament this week and sent to Parliament's Standing Committee on Finance for further discussions, it added.
The new income tax bill has been introduced to replace nearly sixty year old Income Tax Act 1961. The proposed bill will include simplified language to benefit taxpayers. Acording to a Business Standard report, the new I-T bill may reduce the number of sections by 25-30% in a bid to simplify tax rules and its clauses.
This blog is now closed. Stay with Livemint for the latest news and developments on the new Income-Tax bill in Parliament.
New Income Tax Bill LIVE News: According to reports, the new Income Tax bill -- promised by Union finance minister in her last year's budget -- will be tabled in parliament on Thursday. The bill is meant to simplify the language of the tax laws and it would later be sent to Parliament's Standing Committee on Finance. It will not change the existing tax slabs or review the tax rebates given.
According to ANI, sources said simplification of the language will make the Act concise, clear, and easy to understand, which will reduce disputes, litigations, and provide greater tax certainty to taxpayers.
The CBDT had set up an internal committee to oversee the review. Also, 22 specialised sub-committees have been established to review the various aspects of the proposed law that would replace the six-decade-old law.
Ahead of drawing up the bill, the government had sought inputs from the people under four categories -- simplification of language, litigation reduction, compliance reduction, and redundant/obsolete provisions.
New Income Tax Bill LIVE News: Finance Minister Nirmala Sitharaman on Tuesday informed the Rajya Sabha that indirect tax under the Goods and Services Tax (GST) has significantly reduced over the years since its implementation. She stated that the average tax under the previous indirect tax regime was 15.8 per cent, under GST it has now come down to 11.3 per cent.
Responding to a question raised by Nadimul Haque, a Member of Parliament from the All India Trinamool Congress (AITC) representing West Bengal, Sitharaman highlighted the reduction in GST rates over time. Sitharaman said under GST, taxes have not gone up even on a single item but it has reduced on many items.
She said "Earlier the tax levied on everyday item 15.8 per cent tax could have been levied without additionally burdening the buyer, consumer. If that was the rate at which the GST rates were brought in, today... the rate has come down to 11.3 per cent. That is the level of reduction of rates which have happened in the GST Council".
New Income Tax Bill LIVE News: Net direct tax collection grew 14.69 per cent to over ₹17.78 lakh crore so far this fiscal, government data showed on Tuesday.
As per the data released by the Central Board of Direct Taxes (CBDT), mop up from net non-corporate taxes, which include mainly personal income tax, grew 21 per cent year-on-year to about ₹9.48 lakh crore.
Net corporate tax collection rose more than 6 per cent to over ₹7.78 lakh crore between April 1, 2024, and February 10, 2025.
Net collections from securities transaction tax (STT) jumped 65 per cent to ₹49,201 crore so far this fiscal.
Refunds worth more than ₹4.10 lakh crore were issued during the period, a 42.63 per cent increase against the year-ago period.
Gross direct tax mop up till February 10 grew 19.06 per cent to more than ₹21.88 lakh crore.
In the revised estimates (RE) for the current fiscal, the government has pegged income tax collections at ₹12.57 lakh crore, up from the budget estimate of ₹11.87 lakh crore.
The collection from STT is pegged at ₹55,000 crore in this fiscal in RE, higher than the budget estimate (BE) of ₹37,000 crore.
Corporate tax collection target was revised lower at ₹9.80 lakh crore, down from the budget target of ₹10.20 lakh crore.
In total, the RE pegs direct tax collections at ₹22.37 lakh crore, higher from ₹22.07 lakh crore in BE.
New Income Tax Bill LIVE News: Finance minister Nirmala Sitharaman said in a post-budget discussion session that the world's scenario in the last 10 years turned 180 degrees. Making the Union Budget is more challenging than ever before, said FM Sitharaman.
New Income Tax Bill LIVE News: The new income tax bill has been introduced to replace nearly sixty year old Income Tax Act 1961. The proposed bill will include simplified language to benefit taxpayers. Acording to a Business Standard report, the new I-T bill may reduce the number of sections by 25-30% in a bid to simplify tax rules and its clauses.
New Income Tax Bill LIVE News: Sameer Mathur Md and Founder of Roinet Solution on new income tax framework:
“The government needs to take decisive steps to simplify and subsidize the tax structure for fintech companies, especially those focused on promoting financial inclusion in Tier 2 and Tier 3 cities. Reducing the GST on financial transactions from the current 18% to a lower slab is crucial to ensure that these companies can serve the economically weaker sections while remaining viable. Additionally, the current tax framework creates an atmosphere of uncertainty, with firms often facing retrospective tax notices despite maintaining clean books and adhering to the rules. This fear of unexpected liabilities due to ambiguous interpretations of tax laws undermines business confidence. Clear, consistent, and forward-looking tax policies are essential to foster a trustworthy and growth-friendly environment for fintech innovation."
Pankaj Nawani, CEO of CarePal Secure feels the new tax structure proposed is good as it “simplifies tax for the majority".
On insurance he added that it will also give a fillip to the employer-employee protection plan which can be made flexible. “The provisions of making proceeds from life insurance policies bought from Gift City could see a lot of HNIs and the upper middle class get interested," he said.
Kunal Varma, Co-Founder & CEO at Freo said the new Income Tax Bill is expected to simplify tax laws, reduce legal complexities, and make compliance easier—something that insurance policyholders have long hoped for.
Expectations:
Sandeep Bhalla, Partner, Dhruva Advisors expects:
Riaz Thingna, Partner-Tax at Grant Thornton Bharat believes the much-awaited Income-tax Bill is expected to carry forward the spirit of ‘Nyaya’.
“The stated aim is to simplify and rationalise the provisions of the more than six-decade old I-T Act by making it concise and simpler to understand. It is expected to reduce the number of pages by half and bring in tax certainty by minimizing ambiguity. Taxpayers can look forward to reduced litigation with a finality on some of the major repetitive issues," Thingna added.
According to Sandeep Chaufla, Partner at PwC, the ongoing review of the Income-tax Act, 1961, seeks to modernise and simplify India's tax system in line with broader economic goals.
“It aims to enhance the ease of doing business, reduce ambiguity in interpretations, improve tax administration and compliance. This will help increase India's tax-GDP ratio to global levels and support sustainable economic growth," Chaufla added.
He also feels the review will also foster a transparent and efficient tax system that attracts investments and advances the Government's vision of a Viksit Bharat.
Ajay Kumar Yadav, CEO & CIO, Wise Finserv believes this is an important step by the government in making the tax system simpler and easier to understand.
He feels:
The new income tax bill has been introduced to replace nearly sixty year old Income Tax Act 1961. The proposed bill will include simplified language to benefit taxpayers. Acording to a Business Standard report, the new I-T bill may reduce the number of sections by 25-30% in a bid to simplify tax rules and its clauses.
Speaking to the media on Saturday, Finance Minister Nirmala Sitharaman said: “…the New Income Tax proposal, I hope to have it introduced in the Lok Sabha in the coming week. Post that it will go to a committee."
“The bill will again go to the Cabinet after the parliamentary committee gives its recommendations on it. After Cabinet approval, it will again be introduced in Parliament. I still have three critical stages to pass through," Sitharaman stated.
New Income Tax Bill LIVE: Sudhakar Sethuraman, partner at Deloitte India, said that if the new income tax bill adopts global practices in taxation, it would improve the nation's competitive stance.
“A balanced approach will modernize the tax system, incentivize investments, and boost job creation," he said.
New Income Tax Bill LIVE: S.R. Patnaik, Head of Taxation at Cyril Amarchand Mangaldas, said the upcoming Income Tax bill is expected to align with global standards.
“With India’s growing role in the global economy and the increasing relevance of digital transactions, it would be difficult for the country to ignore international best practices," S.R. Patnaik, head of taxation at Cyril Amarchand Mangaldas, told Mint. “We are certain the new Act will align with global standards and India’s economic commitments."
New Income Tax Bill LIVE: According to Dipesh Jain, partner, Economic Laws Practice, income from salary is quite clear in the existing Income Tax law and should remain same in the proposed I-T bill. Other things which should remain are income from house property
New Income Tax Bill LIVE: The new I-T bill will reduce complexity related to clauses for taxpayers. Additionally, the new bill will also ensure simpler tax filing for both taxpayers and authorities.
New Income Tax Bill LIVE: Over the past decade, the Modi government has implemented several tax reforms for taxpayers including faceless assessment, taxpayers charter, Vivad se Vishwas scheme, etc.
The new income tax bill has been introduced to replace nearly sixty year old Income Tax Act 1961. The proposed bill will include simplified language to benefit taxpayers.
New Income Tax Bill LIVE: Finance Minister Nirmala Sitharaman has not provided any fixed timeline of the I-T bill. Shedding light upon the complete procedure of passing I-T bill in the Parliament, FM said that first I-T bill will be introduced in Lok Sabha then it will be reviewed by the committee.
After evaluation, committee will give its recommendation and then it will be sent back to the government through cabinet. Later, the cabinet will take a call on whether the suggested amendments are to be taken in or not.
"It's only after that it again goes to the parliament. So once the parliament passes, it is when they decide on when best to roll it out from," she added.
New Income Tax Bill LIVE: The I-T bill will be introduced in the Lok Sabha. After being tabled in LS, the bill will be sent for a review to a comitttee.
"(I) hope to have it introduced in the Lok Sabha in the coming week," she said. Post the inroduction, it will go to a committee for scrutiny.
New Income Tax Bill LIVE: The new income tax bill, after being passed in Lok Sabha and Rajya Sabha, will replace the sixty year old Income Tax Act 1961.
New Income Tax Bill LIVE: While addressing the media, FM Nirmala Sitharaman said that the I-T bill will have to pass through three stages. After getting approved by the cabinet, it will be introduced in the Parliament, then it will be sent to the committee. After that, it will be sent back to Cabinet for consideration.
"Yesterday, the Cabinet cleared the New Income Tax proposal, I hope to have it introduced in the Lok Sabha in the coming week. Post that it will go to a committee," Sitharaman said a media briefing after addressing the post-Budget customary meeting with the central board of directors of the Reserve Bank of India (RBI).
The bill will again go to the Cabinet after the parliamentary committee gives its recommendations on it. After Cabinet approval, it will again be introduced in Parliament.
New Income Tax Bill LIVE: The new income tax bill, set to be presented in Parliament this week, may reduce the number of sections by 25-30% in a bid to simplify tax rules and its clauses, reported Business Standard.
New Income Tax Bill LIVE: There is no official confirmation about the date of the introduction of the new I-T bill at the Parliament. According to Times of India, FM Nirmala Sitharamal will introduce the new income tax bill in Parliament on Tuesday.
New Income Tax Bill LIVE: According to experts, the new tax law will simplify compliance and reduce disputes. It will also ensure that complications and details related to I-T law are simplified for common people.
The new income tax bill is set to come into effect from the financial year 2025-26, and effective from the assessment Year 2026-27, according to the budget announcement of February 1, 2025.
The Union Cabinet, chaired by Prime Minister Narendra Modi, on February 7 approved new Income Tax bill, PTI reported citing sources.
It is now expected be presented in the Parliament during this week and would be sent to Parliament's Standing Committee on Finance, it added.
The Union Cabinet has approved the new Income Tax Bill on Friday, February 7, potentially leading to its introduction in the Lok Sabha early next week. This bill is part of a larger effort to reform the tax system and aims to overhaul the existing tax structure to make it more streamlined and transparent.
Good morning and welcome to Livemint's LIVE coverage of the new Income Tax Bill expected to be announced in Parliament this week
The new bill, announced by Finance Minister Nirmala Sitharaman in the Union Budget, was approved by the Union Cabinet on February 7.
