Parliament Refers To The New Income Tax Bill To Select Review Committee

Union Finance Minister Nirmala Sitharaman on Thursday introduced the 2025 Income Tax Bill in the Lok Sabha. Following the introduction, the bill was referred to a select committee for detailed scrutiny.

Select Committee to Review the Bill

The select committee will carefully examine the proposed changes in the Income Tax law and submit a detailed report to Parliament by the first day of the next session, Sitharaman stated. While the draft legislation does not introduce major structural changes, it aims to simplify tax laws by making the language more straightforward and removing unnecessary provisions.

Implementation and Key Features

The Union government has proposed that if Parliament clears the bill, it will come into effect in the financial year 2026-27. Once enacted, it will replace the existing 1961 Income Tax Act, which has undergone multiple amendments over the years.

Sitharaman had first proposed the introduction of a new direct tax bill while presenting the Budget on February 1, 2025.

The new bill includes 536 sections compared to 298 in the current tax law. Additionally, it has 16 schedules, slightly more than the 14 schedules present in the existing framework.

Opposition Raises Concerns

Opposition leaders have criticized the bill, arguing that instead of simplifying the tax laws, the new legislation has made them more complex.

“The Union finance minister said that the new Income Tax Bill would be easy,” Congress MP Manish Tewari remarked. “It has instead become more complicated.”

Following the heated discussions over the new tax bill, the Lower House was adjourned until March 10, when the second half of the Budget Session is scheduled to begin.

ALSO READ: 19 Months After Arrest, Former Dean Of COVID-19 Jumbo Centre Gets Bail From Bombay HC