New Income Tax Bill 2025 Highlights: FM Sitharaman urges Lok Sabha Speaker to refer the Bill to Parliament select committee

While the government has been pitching the new Income Tax Bill as a more simplified version of the old Tax Act, Congress MP Manish Tewari has claimed that is in fact “more complicated.”

Commenting on the new Income Tax Bill that will be tabled by Finance Minister Nirmala Sitharaman in the Lok Sabha today, Feroze Azeez, Deputy CEO at Anand Rathi Wealth Limited says that this new Bill marks a major move toward simplification when compared to the Income Tax Act of 1961. “With more straightforward language and a better-organized structure, it greatly enhances the average person’s ability to understand the law,” Azeez said. He further added, “The government has also fulfilled its commitment to avoid significant changes, with most provisions remaining the same. As we have often expressed our desire and hope for simplification, it now appears that this vision is becoming a reality.”

According to the new Act, a resident of India in a tax year has been defined as someone who has stayed here for a period of 182 days or more, or it could be an individual who has been in India for a total of 60 days or more over a period of one year or more, in the four years preceding the tax year.

The goal for this new Bill is to make the language simple and eliminate redundant provisions to make it easier for the common man to understand it better. There is a well outlined structure on revised penalties and tax compliance, and also the introduction of ‘tax year’ instead of the old ‘assessment year’. Some of the changes introduced show strengthened GAAR and presumptive taxes for non-residents.

According to the first draft of the Bill that is doing the rounds of the internet, the new Bill does not introduce any new taxes. However, it has gotten rid of a few outdated provisions and made the language easier for understanding. Experts hope that the new bill focuses on capital gains tax reforms and address the issues regarding holding periods that aren’t consistent. From the simple, clear-cut language, it does seem like that the new Bill could prove to be a game-changer.

Both the Houses of the Parliament, the Lok Sabha and the Rajya Sabha will resume their proceedings today at 11:00 AM. All eyes are on the Parliament Budget Session today as Finance Minister Nirmala Sitharaman will be presenting the new Income Tax Bill. For real-time updates on the tabling of the new Bill, keep watching this space.

The new Income Tax Bill has introduced the concept of ‘tax year’ which will begin from April 1, 2026. In case you an individual starts a new business or profession, then the financial year will begin from the date of opening the new business or profession or from the date on which the new source of income inflows.

Read More Here: Key provisions in the bill taxpayers need to know

The new Income Tax Bill introduces some stringent taxation rules for crypto investors and traders. The bill brings back 30% tax on income that comes from virtual digital assets including crypto, NFTs, and more. The Bill doesn’t allow any deductions or exemptions, except for the cost of buying the assets. It also has 1% tax on crypto transactions.

The new Income Tax Bill is set to eliminate the extra provisions and make the language easier for the common taxpayer to understand. This bill has been introduced to replace the old Income Tax Act, 1961. The proposed Bill has also been cut short in length to keep it comprehensive for simple understanding.

Read More Here: How the New Income Tax Bill could impact taxpayers

The Bill has 536 sections, 23 chapters and 16 schedules in 622 pages. The older bill, on the other hand, had 298 sections and 14 schedules, but was spread out into 880 pages when it was introduced. The new bill doesn’t have any new taxes, instead, it has just simplified the language all over.

Read More Here: How is the new tax law different from the old one?

Deloitte India partner Rohinton Sidhwa told PTI that the new Bill promises to be more streamlined, thus making it simpler for citizens to fullfill their tax obligations while also building their trust in the system. Sidhwa said that by replacing complicated provisions, the new Bill will reduce legal disputes and automatically encourage tax compliance from taxpayers.

The new Income Tax Bill 2025 will come into effect from April, 2026. After FM Sitharaman presents the Bill in the Lok Sabha, it will then be sent a Parliamentary Standing Committee for further discussion and review.

A streamlined and simplified bill with 536 sections and 23 chapters, spanning 622 pages, is set to be introduced in the Lok Sabha. The new bill will replace the Income Tax Act, 1961, which became complex over the years due to multiple amendments.

Key terminology changes:

– ‘Previous year’ replaced with ‘tax year’.

– Assessment year concept removed—tax will now be calculated for the tax year itself.

– Previously, income earned in one year (e.g., 2023-24) was taxed in the next year (e.g., 2024-25).

– Now, taxation will follow a single tax year approach.

– Number of sections increased from 298 to 536.

– Schedules increased from 14 to 16.

– Chapters remain at 23.

– Total pages reduced to 622, making it nearly half the size of the amended 1961 Act.

Hello and welcome to our live blog. Finance Minister Nirmala Sitharaman will table the new I-T Bill in the Lok Sabha today and here we are to you bring real-time updates straight from the Parliament. Meanwhile, stay with us as we bring to you all the key pointers from the new, much talked about, Income Tax Bill.