Income Tax Bill 2025: The new Income Tax Bill will replace the Income Tax Act, 1961. This new bill will allow people to claim TDS refund even if they are unable to file income tax returns within the stipulated time. Along with this, many other big changes have been made
Income Tax Bill 2025: The Lok Sabha on Monday (August 11) passed the new Income Tax Bill in three minutes without any discussion after incorporating almost all the recommendations of the Select Committee. It will replace the Income Tax Act, 1961. This new bill will allow people to claim TDS refund even if they are unable to file income tax returns within the stipulated time. There was a deadlock in the Lok Sabha on Monday (August 11) due to the uproar of members of opposition parties on the issue of voter list verification and alleged electoral rigging. However, the House approved four important bills including the Income Tax Bill.
Amid sloganeering by members of opposition parties on the issue of SIR and alleged ‘vote theft’ in Bihar, Union Finance Minister Nirmala Sitharaman introduced the Income Tax (No. 2) Bill, 2025 in the Lok Sabha for passage, which was passed by the House by voice vote. Sitharaman had withdrawn the Income Tax Bill, 2025 introduced in February on August 8. He presented the updated version of the bill in the House on Monday. Almost all the recommendations of the Select Committee have been included in it.
The new bill will replace the existing Income Tax Act, 1961. Many amendments were made in it in the last few years. The new bill retains the basic tax provisions of the current Act. It mainly provides for simplifying the language and removing unnecessary provisions.
The objects and reasons of the new bill states, “Almost all the recommendations of the Select Committee have been accepted by the Government. In addition, suggestions have been received from stakeholders regarding such changes that will more accurately convey the proposed legal meaning.”
The government introduced the Income Tax Bill, 2025 in the Lok Sabha on February 13. Then the Select Committee headed by Bharatiya Janata Party (BJP) MP Baijayant Panda recommended some changes in it. Then that bill was withdrawn in the House on Friday.
The Select Committee had suggested that the government should change the provisions related to TDS claims for those who are unable to file income tax returns (ITR) by the due date. According to the amended bill, people will be allowed to claim TDS refund in case of filing income tax returns after the deadline provided for filing the original income tax return.
According to PTI, the statement on the bill said, “Improvements have been made in the nature of the draft. Therefore, the government decided to withdraw the Income Tax Bill, 2025 in accordance with the report of the Select Committee. As a result, the Income Tax (No. 2) Bill, 2025 has been prepared to replace the Income Tax Act, 1961.
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