New Delhi, Feb 12 (PTI) The Income Tax Bill, 2025, which seeks to replace the Income Tax, 1961, will be introduced in Parliament on Thursday.

Following are the highlights of the new bill: * Income Tax Bill, 2025, simplifies language, omits redundant provisions, uses shorter sentences; * The Bill does not impose any new taxes, only puts together the taxability provisions provided in the Income Tax Act, 1961; * Comprises 536 sections, 23 chapters and 16 schedules in just 622 pages. This compares with 298 sections, 23 chapters and 14 schedules in the 1961 Act; * New law to come into effect from April 1, 2026; rules to be put in place once Act is notified; * Includes both old tax regime and new tax regime for individuals, HUFs and others; * 'Tax year' concept introduced, complicated terms like 'Previous year' and 'Assessment year' omitted in the new Bill; * The word 'notwithstanding' removed, replaced with 'irrespective'; * Does not refer to 'explanations or provisos', instead uses tables and formulae; * Taxpayer's Charter, which outlines the rights and obligations of taxpayers, included in the Bill; * The Bill provides for special provision for capital gains computation in case of market-linked debenture; * Income not forming part of total income moved to Schedules to simplify the statute; * Deductions from salaries such as standard deduction, gratuity, leave encashment etc, tabulated at one place, instead of being scattered over different sections/rules. PTI JD DP DP SHW

 

Income Tax Bill, 2025 as introduced in the Lok Sabha as on 13-2-2025

Income tax law codification simplifies the code, retains tax regimes and introduces the tax year concept plus taxpayer protections. Income Tax Bill, 2025 consolidates and simplifies income tax law without creating new taxes, retains both old and new individual tax regimes, introduces the tax year concept replacing 'previous year' and 'assessment year', moves non taxable income into schedules, tabulates salary deductions in one place, replaces explanations and provisos with tables and formulae, includes a Taxpayer's Charter, and provides special capital gains computation rules for market linked debentures.