New Income Tax Bill 2025 Passed: Simpler and Clearer Tax Rules from April 2026:

New Income Tax Bill 2025 Passed: Simpler and Clearer Tax Rules from April 2026 The Lok Sabha had recently passed the New Tax Bill 2025, officially known as the Income Tax Act, 2025. The new Act, effective from April 2026, is replacing the old Income-Tax Act, 1961, which has been effective for more than 60 years. The bill was passed on without any debate, amid loud protest in the Parliament, after taking the suggestions from the Select Committee, chaired by Baijayant Panda.

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The government had earlier introduced a draft version of the Income Tax Bill 2025, but it was withdrawn due to some drafting mistakes and unclear language. After a careful review and analysis, the revised version was presented on August 11, which addresses the issues identified by the Select Committee in the previous version. As per the Finance Minister Nirmala Sitharaman, the revised Bill improves the language and corrects cross-references. One of the main goals of the new bill is to make the tax system simpler, more transparent and easier to understand. It has a simple definition and easy rules, reduces penalties for small mistakes and follows a new approach called "trust first, scrutinise later". However, there are no changes in the tax slabs or capital gain rules.