New Income Tax Bill: The new Income Tax Bill will be introduced in the Lok Sabha today, bringing several significant changes to the tax system. The language of this bill, presented for 2025, has been made simpler and more concise to ensure better understanding for taxpayers. The definition of income has been expanded, including its sources. One major change is the introduction of the concept of a ‘Tax Year,’ which will start on April 1st and last for 12 months. Additionally, the term ‘Assessment Year’ has been removed. This 622-page bill aims to simplify and make the tax process more transparent.
Finance Minister Nirmala Sitharaman has already indicated that the bill will be sent to a parliamentary committee for detailed analysis and discussion. This suggests that the government has carefully considered all aspects of tax system reforms and wants to gather opinions from all stakeholders before implementing them.
10 Key Highlights of the New Income Tax Bill
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Old Tax System to Continue: The new bill clarifies that the old tax slabs will remain available, giving taxpayers the option to choose their tax plan accordingly.
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New Tax Structure (Revised Tax Slabs): Some changes may be introduced in the tax slabs, making the tax calculation process simpler and more transparent.
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Changes in Deductions and Exemptions: The new system may modify certain deductions and exemptions, such as HRA, Section 80C benefits, and other tax advantages.
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Corporate Tax: This bill may introduce new reliefs and rules for companies to boost business growth and attract foreign investment.
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Changes in Income Tax Return (ITR) Filing: The new process is expected to make tax return filing easier and faster for taxpayers.
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Consideration of Global Income: Tax provisions may be revised for taxpayers earning income from foreign sources.
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Transparency in Tax Assessment: The bill aims to enhance transparency in tax assessment and payment processes, reducing confusion for taxpayers.
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Next Step – Digitalization of the Tax System: Measures will be introduced to promote digitalization in India’s tax system, enabling online services for taxpayers.
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Relief for Small Businesses: Small and medium enterprises (SMEs) may receive tax relief, such as exemptions in tax slabs or deductions for business expenses.
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Tax Exemptions in Agriculture: Revisions in the tax framework may provide relief to the agricultural sector, offering additional incentives to farmers.
This bill aims to provide taxpayers with a more transparent, simplified, and easy-to-understand tax system