A 60-year-old law changed in just three minutes, new Income Tax Bill was passed by Lok Sabha

New Income Tax Bill: The Lok Sabha has replaced the Income Tax Act of 1961 by passing the new Income Tax Bill 2025 in just 3 minutes. This bill includes provisions like TDS refund, relief on late income tax returns, and strengthening the rights of taxpayers. Finance Minister Nirmala Sitharaman called it a big step towards making tax law simple and transparent. Experts believe that this will improve tax administration and promote financial transparency, which will benefit the common taxpayers.

New Income Tax Bill: The Lok Sabha on Monday passed the Income Tax Bill, 2025 by voice vote in just three minutes. This new bill will replace the Income Tax Act in force since 1961. Finance Minister Nirmala Sitharaman introduced it in the House amid sloganeering by the opposition. This bill will especially provide relief to those taxpayers who are unable to file income tax returns on time but want to claim TDS refund.

New provision to replace old law

The new bill will completely replace the existing Income Tax Act, 1961. Several amendments were made to the old law in the last few years, but the language and provisions remained complex. In the new law, the language has been simplified and clarified while retaining the basic tax provisions and unnecessary provisions have been removed.

Introduced in February, amended in August

The government introduced the Income Tax Bill, 2025 in the Lok Sabha on 13 February 2025. It was referred to the Select Committee, which was headed by BJP MP Baijayant Panda. The committee suggested several changes, which were almost completely accepted by the government. On August 8, the old bill was withdrawn and a new revised version was introduced.

Important recommendations of the Select Committee

The Select Committee suggested that taxpayers who file returns after the prescribed deadline should also be allowed to claim TDS refund. This change has been incorporated in the amended bill, which is likely to provide relief to lakhs of taxpayers.

Stakeholders' opinion included

According to the Finance Minister, apart from the recommendations of the Select Committee, the government also received many suggestions from stakeholders. These included points like making the legal language more precise and improving the alignment of phrases in the draft. As a result, the new bill has been prepared in a more clear and easy to understand form.

Effect of changes in Income Tax Act

Basic tax provisions retained: No major changes in the main provisions of the old Act.

Simplicity in language: Legal terms made easy for the common man.

Unnecessary sections removed: Many complex and irrelevant provisions were abolished.

New provision for TDS refund: Facility to claim has also been provided to those who file returns late.

Result of changes in Income Tax Act

With the passing of the new Income Tax (No. 2) Bill, 2025, the 60-year-old Income Tax Act will come to an end. This law will simplify the tax system, provide more convenience to taxpayers and make the rules for TDS refund flexible. The government believes that this change will strengthen the rights of taxpayers and make tax administration more transparent.

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