Finance Minister Nirmala Sitharaman is expected to introduce the much-anticipated New Income Tax Bill in the Lok Sabha this week, sparking widespread speculation about its potential impact on taxpayers.
According to tax experts, the bill is likely to bring significant reforms in India’s taxation system by focusing on simplification and modernization rather than imposing new taxes. The proposed changes are expected to reduce legal complexities, streamline compliance, and make tax laws more accessible to the public.
Last week, Sitharaman confirmed that the bill—set to replace the six-decade-old Income Tax Act, 1961—had been approved by the Union Cabinet, chaired by Prime Minister Narendra Modi.
“Yesterday, the Cabinet cleared the New Income Tax proposal. I hope to have it introduced in the Lok Sabha in the coming week. Post that, it will go to a committee,” Sitharaman said at a media briefing after her post-Budget meeting with the Reserve Bank of India’s (RBI) central board.
After its introduction in Parliament, the bill will be referred to a parliamentary standing committee for scrutiny, before being sent back to the Cabinet for final approval.
With the new bill expected to simplify taxation and ease compliance, its rollout will be closely watched by both taxpayers and businesses. Sitharaman first announced a comprehensive review of the Income Tax Act during the July 2024 Budget session, laying the groundwork for this major tax overhaul.