Comprehensive Analysis of Total Income in Clause 101 of the Income Tax Bill, 2025 Vs. Section 66 of the Income Tax Act, 1961

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....ions within the broader framework of income tax legislation. Objective and Purpose Clause 101 of the Income Tax Bill, 2025, and Section 66 of the Income Tax Act, 1961, serve the purpose of ensuring that all income streams, including those not subject to income tax under certain provisions, are aggregated to compute the total income of an assessee. This approach prevents tax evasion and ensures a comprehensive assessment of an individual's or entity's financial activities. The inclusion of such income ensures that the tax base is not eroded by exempt income that may otherwise escape taxation. The legislative intent behind these provisions is to create a fair and equitable tax system where all sources of income are accounted for, th....

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....hich no income-tax is payable under Chapter VII. However, it also referenced deductions available u/ss 87, 87A, and 88, which were omitted by the Finance (No. 2) Act, 1967. Key elements of Section 66 include: Inclusion of Exempt Income:- Like Clause 101, Section 66 aimed to include income exempt under specific provisions, ensuring a comprehensive tax base. Historical Amendments:- The removal of references to deductions u/ss 87, 87A, and 88 indicates a legislative shift towards simplifying the aggregation process and eliminating complexities related to deductions. Alignment with Broader Tax Policy:- The provision reflects a consistent policy approach to include all income streams in total income calculations, aligning with p....