New Income-tax Bill, 2025 Introduced: A Major Leap Toward Simplified Tax Laws

The Income-tax Bill, 2025 exemplifies the Government’s resolve to enhance the ease of doing business and create a transparent, user-friendly tax framework.

Today, the Government introduced the Income-tax Bill, 2025 in Parliament, marking a pivotal reform to modernize and simplify the Income-tax Act, 1961. The new bill aims to streamline the law while ensuring continuity and clarity for taxpayers.

Guiding Principles of Simplification:

• Clarity and Coherence: Textual and structural improvements for better understanding.
• Continuity: No major tax policy changes to maintain certainty.
• Stability: Tax rates remain unchanged, ensuring predictability for taxpayers.

Key Simplification Measures Adopted:

1. Enhanced Readability: Complex language replaced with clearer, concise terms.
2. Efficient Structure: Redundant and repetitive provisions removed.
3. Logical Organization: Sections reorganized for easier reference.

Consultative and Research-Based Approach:

The simplification process involved extensive stakeholder engagement:

• 20,976 online suggestions received, reviewed, and incorporated where feasible.
• Consultations with tax professionals, industry associations, and business leaders.
• Study of international best practices from Australia and the UK.

Key Outcomes of the Reform:

• Reduced Volume: A shorter, streamlined Act for easier navigation.
• Improved Accessibility: Simplified language for broader understanding.
• Consolidated Amendments: Reduced fragmentation by merging multiple updates.
• Modern Structure: Use of tables and formulae for better readability.
• Continuity Preserved: Existing taxation principles retained for consistency.

The Income-tax Bill, 2025 exemplifies the Government’s resolve to enhance the ease of doing business and create a transparent, user-friendly tax framework. The new legislation stands as a significant step towards a modern and simplified tax environment for all stakeholders.