The government today introduced the new Income Tax Bill 2025 in the Lok Sabha, the lower house of Parliament. After the bill was introduced in the Lok Sabha, it was sent to the Select Committee for review. Along with this, Lok Sabha Speaker Om Birla has postponed the Lok Sabha proceedings till 9 March. Now the second session of the budget session will start at 11 am on March 10. The committee can submit its report on the first day of the second session. When this committee submits its final report, the Parliament will consider passing the bill.
The new Income Tax Bill will replace the Income Tax Act 1961. Many changes have been made in the new bill. This information came to light in a draft copy released on Wednesday before its release. The new bill has been described as transparent and taxpayer-friendly. It proposes strict rules on simplifying the tax system through digitization, improving tax payment and tax evasion.
Important things about Income Tax Bill 2025
1. The number of pages in the bill has been reduced.
The first and major change in the new income tax bill is that it is placed in somewhat brief and simple terms compared to before that the common man can easily understand it. For example, the Income Tax Bill of 1961 was of 880 pages. But after six decades, now the number of pages included in it has been reduced to 622. The new tax bill has 536 sections and 23 chapters.
2. Concept of ‘Tax Year’
The concept of tax year has been presented in the new bill presented today. Which will replace the tax assessment year and previous year. It is generally seen that taxpayers are confused about evaluation and financial year when filing taxes. But now instead of finishing it, only tax year will be used. For example, tax from 1 April, 2025 to March 31, 2026 will be 2025-26. This means that the entire 12 months of the financial year will now be considered as tax years.
3. Standard deduction
Under the new tax bill, if you are a salaried person, you will get a standard deduction of Rs 50,000 under your old tax system, but if you choose the new tax system, this deduction will be up to Rs 75,000. Along with this, there will be no change in the tax slab under the system and the rates declared in the budget will remain unchanged.
Income up to Rs 4 lakh – no tax
Income from Rs 1 lakh 1 to 8 lakh rupees – 5 percent tax
Income from Rs 8 lakh 1 to 12 lakhs – 10 percent tax
Income from Rs 12 lakh 1 to 16 lakh rupees – 15 percent tax
Income of Rs 16 lakh 1 to 20 lakhs 20 percent tax
4. CBDT gets this power
The next major change in the changes made in the new tax bill as compared to the Income Tax Act 1961 is related to the Central Direct Tax Board i.e. CBDT. According to the Bill, earlier the Income Tax Department had to contact Parliament to start various tax schemes. But according to the new tax Act 2025, now CBDT has been empowered to start such schemes independently. Its purpose is to eliminate the problem of bureaucracy delay.
5. Capital profit rates will remain unchanged.
The draft has not made any changes in the short -term capital profit period for the stock market. Under Section 101 (B), a period of up to 12 months will be considered a short -term capital gain. Apart from this, its rates have also been kept the same. The short -term capital profit tax has been retained at 20 percent. Whereas a tax of 12.5 percent will be applicable under long -term capital gains.
6. Rebate on pension, NPS and insurance:
Tax deduction on pension, NPS contribution and insurance will continue under the new Income Tax Bill. Retirement funds, gratuity and PF contribution are also placed under tax exemption. Investment in ELSS Mutual Fund will also be taxed.
7. Fines on tax evasion:
The new tax bill provides for rigorous punishment and fine on those who steal tax. Those who intentionally steal tax, they can be prosecuted. More interest and fine can be imposed for non -payment of taxes. If a person tries to hide his income, his account can be confiscated. In addition, heavy fines will also be imposed on giving incorrect or incomplete information.
8. E-KYC required to make tax payment transparent
The central government aims to make the existing tax system digital and more transparent through the new tax bill. For this, e-KYC and online tax payment is being made mandatory. Making e-filing mandatory will increase transparency in tax payment.
9. Tax exemption on agricultural income:
In the new tax bill, agricultural income has been kept tax -free under certain conditions. There will be the benefit of tax exemption on the amount given to religious trusts, institutions and charitable institutions. Along with this, the electoral trust has also been exempted from tax.
10. This change has been done to reduce and reduce controversies.
Many vague provisions in the 1961 tax bill have created disputes between taxpayers and the government and the number of cases has increased continuously. The new tax bill is being introduced with clear rules and simple words. Which will make it easier to understand and at the same time the number of disputes is also expected to decrease.
