New income tax bill to be tabled in Lok Sabha tomorrow: Sources

The new tax bill announced in the Budget to overhaul the Income Tax Act, 1961, will be tabled in Parliament tomorrow, according to sources. Last week, the Cabinet had given its approval to the new income tax proposals. In Budget 2025-26, the government announced a new income tax bill to overhaul the Income Tax Act, 1961 and make it more simple and easy to understand.

The finance ministry has already assured that there won’t be any new tax in the upcoming bill. Also, the Central Board of Direct Taxes (CBDT) has said that the new bill will go a long way in simplifying the old act in which redundancies have crept in. “I assure you that there will be no new taxes in the bill,” said revenue secretary Tuhin Kanta Pandey, during a post-Budget interaction at PHDCCI last week.

According to the Central Board of Direct Taxes (CBDT), the bill will, in a way, be the direct tax code and will be a comprehensive document.

According to the CBDT, to encourage taxpayers towards compliance, the government has put in place a statute that is easy to understand. A substantial reduction of the current provisions will take place in the new direct tax code.

In the Budget, finance minister Nirmala Sitharaman laid emphasis on the “trust first” approach to taxation. “Over the past 10 years, our Government has implemented several reforms for convenience of tax payers, such as (1) faceless assessment, (2) tax payers charter, (3) faster returns, (4) almost 99 per cent returns being on self-assessment, and (5) Vivad se Vishwas scheme. Continuing these efforts, I reaffirm the commitment of the tax department to “trust first, scrutinize later”. I also propose to introduce the new income-tax bill next week,” Sitharaman said in the Budget speech.

After being tabled in Parliament, the bill will be referred to the standing committee. Post review by the committee, the government, through the Cabinet, will take a call on the amendments proposed.