Finance Minister Sitharaman to Unveil New Income Tax Bill Today, LS Resumes at 2 PM
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Synopsis
Finance Minister Nirmala Sitharaman will introduce the new Income Tax Bill aimed at simplifying tax laws and reducing legal disputes. The bill, set for introduction today in the Lok Sabha, will replace the outdated Income Tax Act of 1961.
Key Takeaways
- Introduction of new Income Tax Bill.
- Bill aims to simplify language and provisions.
- Current law to be replaced with a 622-page document.
- Effective date set for April 1, 2026.
- No changes to existing tax slabs or rebates.
New Delhi, Feb 13 (NationPress) Finance Minister Nirmala Sitharaman is set to present the new Income Tax Bill in the Lok Sabha today as part of the tax reforms aimed at simplifying and clarifying the provisions to enhance understanding and minimize legal disputes.
The Parliament’s Budget Session commenced at 11 a.m., but the Lok Sabha was adjourned until 2 p.m. due to protests from opposition members over various issues. The Finance Minister is anticipated to introduce the Income Tax bill in the Lower House later today.
The new Income Tax Bill has been condensed to 622 pages, containing 536 clauses, replacing the current 64-year-old law, which spans 823 pages and includes 819 sections. The proposed bill aims to clarify the language by using simpler terms, such as substituting 'assessment year' with 'tax year'. It will also remove several complex provisions and explanations, making it more comprehensible and reducing the potential for legal disputes. Some outdated clauses are being eliminated as part of this simplification effort.
This legislation will replace the Income Tax Act of 1961, which has expanded significantly over the years due to numerous amendments. The reformed tax framework is projected to be implemented on April 1, 2026.
The main goal is to simplify tax laws, ensuring they are more transparent, easier to interpret, and more user-friendly for taxpayers. By replacing complicated provisions with clearer ones, it aims to lessen legal disputes and promote voluntary tax compliance.
Once presented in the Lok Sabha, the Bill will be forwarded to the Parliamentary Standing Committee on Finance for additional discussions. The new law is expected to take effect on April 1, 2026.
The bill will not alter current tax slabs or reevaluate tax rebates. Instead, its objective is to make the six-decade-old legislation more accessible.
“This reform represents a crucial step towards modernizing India's tax framework, enhancing clarity and efficiency. The bill promises a more streamlined, user-friendly tax system, facilitating compliance for citizens and businesses while fostering trust in the system,” states Rohinton Sidhwa, Partner at Deloitte India.
