FM Nirmala Sitharaman Tables Income Tax Bill: Finance Minister Nirmala Sitharaman introduced the new Income Tax Bill 2025 in Parliament on Monday, August 11. This new bill is set to replace the existing Income Tax Act of 1961. The bill was withdrawn last week after the Lok Sabha session was adjourned. Following this, a committee decided to make significant changes and overhaul the legislation.
According to Parliamentary Affairs Minister Kiren Rijiju, the new bill will be “completely different” from its predecessor. The government has incorporated 285 suggestions from the Lok Sabha Select Committee, which is headed by BJP leader Baijayant Panda. These suggestions address the confusion surrounding the old bill, leading to the introduction of this new version.
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Why Was the Bill Withdrawn?
The bill was withdrawn in the previous session because the meeting was adjourned. The government then took the opportunity to make necessary changes, and the revised bill will be presented to the House today.
Suggested Changes Incorporated in the New Bill
The Select Committee presented its suggestions for the Income Tax Bill on July 21, and these have been included in the new draft. The changes aim to simplify the law’s language, correct phrasing, and improve cross-referencing. The panel also proposed major substantive changes, including:
Tax Refunds: The previous bill had a provision that denied tax refunds if an income tax return was not filed within the specified timeframe. The new bill, as suggested by the committee, deletes this provision.
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Inter-Corporate Dividends: The previous bill, which was withdrawn, did not include a provision for inter-corporate dividends under Section 80C of the Income Tax Act, a provision that allows for these dividends to be distributed among companies. This is now expected to be addressed in the new bill.