Nirmala Sitharaman introduces new Income Tax Bill in Lok Sabha; Opposition stages workout
PTC Web Desk: Amidst commotion in Parliament, Finance Minister Nirmala Sitharaman on Thursday introduced the Income Tax Bill 2025, prompting several Opposition MPs to stage a walkout. However, the exact number of MPs who exited the session remains unclear.
Notably, in a bid to simplify and modernise India’s tax system, Finance Minister Nirmala Sitharaman has introduced the Income Tax Bill 2025, aiming to make tax laws more concise, clear, and user-friendly. The new Bill uses straightforward language, eliminating complex legal jargon and redundant sections. It also replaces the confusing alphanumeric section numbering with a clear numerical system. The proposed legislation is condensed to 566 pages, significantly shorter than the current Act's 800 pages.
The Bill introduces the term 'Tax Year', replacing 'Previous Year' and 'Assessment Year,' reducing confusion for taxpayers. To address backlog issues, a time limit is set for disposing of appeals at the first appellate authority level.
The Bill maintains well-established tax principles, supporting the government's objective of enhancing ease of doing business in India.
However, Kerala’s Kollam MP, NK Premachandran, raised objections about the new Bill containing more sections than the 1961 Income Tax Act. Responding to this, Sitharaman explained, “He should understand where the law stands today and how it’s being streamlined.” She noted that when the Income Tax Act was first enacted in 1961 and implemented in 1962, it contained only 298 sections. However, over time, amendments increased the number to 819 sections. “From that 819, we're bringing it down to 536. He should consider its current state,” she added.
Sitharaman highlighted that 4,000 amendments have been made to the 1961 Act since its inception, and the current revision aims to address them.
Regarding TMC MP Professor Sougata Ray's criticism that the changes in the new tax Bill were merely “mechanical,” Sitharaman countered, “These are not mechanical changes. Significant adjustments have been made. The word count has been halved, and the number of sections and chapters reduced. The language has been simplified into plain English and Hindi.”
Proposal to send Bill to House Committee
Sitharaman proposed that the Income Tax Bill 2025 be reviewed by a newly formed Select House Committee. She noted that the terms of reference for the committee would be decided by Speaker Om Birla. The committee is expected to present its report on the first day of the next parliamentary session.
Where to Access the Income Tax Bill 2025
Those interested in reading the Income-Tax Bill 2025 will soon be able to access it on the official Lok Sabha website. Visit sansad.in/ls/legislation/bills for the latest updates and full text of the Bill.
- With inputs from agencies
