Nirmala Sitharaman to Introduce Income-Tax Bill 2025 in Lok Sabha Today

New Delhi – Finance Minister Nirmala Sitharaman is set to introduce the new Income-Tax Bill 2025 in the Lok Sabha today, February 13. The Bill aims to consolidate and amend India’s income-tax laws, simplifying the complex framework that has been in place for decades.

The Income-Tax Bill 2025 seeks to replace the six-decade-old Income Tax Act of 1961, which has grown increasingly voluminous due to numerous amendments over the years. The new Bill does not propose any new taxes but focuses on streamlining existing provisions and simplifying the language of the law to ensure greater clarity and ease of understanding for taxpayers.

A key feature of the new Bill is its intent to eliminate several 'obsolete' sections from the current Act. Experts believe that this overhaul will reduce litigation, enhance tax compliance, and make the entire system more transparent and taxpayer-friendly.

In addition to removing redundant clauses, such as those relating to the Fringe Benefit Tax, the Bill introduces a simplified concept of a ‘tax year.’ This new terminology replaces the existing terms ‘assessment year’ and ‘previous year,’ making the system more intuitive for taxpayers. Under the current system, income earned between April 2024 and March 2025 is assessed in the fiscal year 2025-26. Under the new Bill, the income earned during this period will be referred to as part of the 'tax year.'

The Income-Tax Bill 2025 also aims to eliminate convoluted legal jargon. The term 'notwithstanding,' which appeared frequently in the current Income Tax Act, has been replaced with the simpler term 'irrespective,' making the language of the Bill more straightforward and accessible.

The new law is expected to come into effect in April 2026, marking a significant step toward reforming India's tax framework. As the Bill progresses through Parliament, it is anticipated to provide much-needed relief to taxpayers and businesses by simplifying the country's tax regulations.

Stay tuned for further updates on the Bill’s introduction and its impact on the nation’s tax system.