India will get New Income Tax Act in Six Months; says FM

Union Finance Minister Nirmala Sitharaman declared on Wednesday that a new tax law, or Income Tax Act, would be implemented within six months to replace the Income Tax Act of 1961, which is more than six decades old.

“Within six months, we will have the tax code or the Income Tax Act, or at least some parts of it, very clearly written in simple easy-to-understand language,” Sitharaman stated during the 165th Income Tax Day Celebration.

“The goal is to make the Act brief, simple, and easy to read and understand. This will reduce conflicts and litigation, ensuring tax certainty for taxpayers. It will also bring down the demand that is currently being litigated,” she had stated.

Meanwhile, Sitharaman asked tax officials to avoid a “threatening tone” in their notices sent to the taxpayers. “Tax notices should be simplified so that individuals may better understand them. Can we look at issuing clear, easy-to-understand notices?” FM Sitharaman asked.

“India and its officers have faced numerous challenges during the previous ten years. The combined effort of taxpayers and income tax officials has resulted in the highest ever income tax collection,” Sitharaman stated.

Sitharaman stated that 72% of all taxpayers have switched to the new tax systems. She described the new tax scheme as clear and outlined its benefits.

Furthermore, FM Sitharaman said that India gained 58.57 lakh new tax filers this year.