The Government of India has withdrawn the Income Tax Bill, 2025, which was introduced in the Lok Sabha on 13 February instead of the six decade -old Income Tax Act, 1961. A new version of the Income Tax Bill will be introduced on Monday, August 11, by incorporating most of the recommendations made by the Select Committee headed by Shri Baijayant Panda. In order to avoid confusion from various sellents of the Bill and to provide a clear and updated version, to provide a clear and updated version, the new version of the Income Tax Bill, 2025 will be introduced to the House on 11 August.
Why was Income Tax Bill withdrawn 2025
Sharing the reasons for withdrawing it in Parliament, Finance Minister Nirmala Sitharaman said that suggestions have been received which is necessary to include the right legislative meaning. Drafting, Fras’ alignment, some changes and cross -referring have been improved. He further said that therefore, the government has withdrawn the Income Tax Bill, 2025 and a new bill will be introduced in the Lok Sabha in place of the Income Tax Act, 1961. In the old version of the bill, lawyers and chartered accountants saw several draft errors, some of which were also identified by the Pravar Samiti of the Lok Sabha.
What were the changes in IT Bill 2025?
The Income Tax Bill, introduced in Parliament by Finance Minister Nirmala Sitharaman in February, was described as the most important change in India’s direct tax in more than 60 years. Its purpose was to convert the Income Tax Act, 1961 with a modern, taxpayer-friendly law, which has been written in simple language and about 50 percent smaller than the current law.
These proposals were given
Easy Legal Language: Small provisions, low provisions and clarifications, and integration of uniform cuttings to make compliance easier.
Less punishment for some crimes: The law was designed to make it more favorable for taxpayers.
No new tax: There is no change in tax slabs, capital gains rules, deadline and income cutagies.
Low litigation: “First belief, later investigation” approach, as well as removing more than 300 old provisions.
Modern Administration: The “tax year” concept was implemented to implement more rights, digital monitoring systems and to reduce confusion between the financial year and assessment year to determine the rules for CBDT.