New Income Tax Bill 2025: In a bid to amend the Income Tax Act of 1961, the Union Cabinet has given the go-ahead to the new Income Tax Bill 2025. By streamlining and making India’s taxation system simpler and more modern, the project plans to expand the reach of the taxpayer.
New Income tax bills for 2025 primary goals:
1. Legal language simplification: Measures try to eliminate uncertainties and make tax laws easier and more briefly to make tax laws easier.
2. Small: It is estimated that the new law will be half of the current, which should reduce legal challenges and improve the effectiveness of tax administration.
3. No new tax will be introduced: Finance Secretary has said that the law will not impose new tax, rather than focusing on the existing tax laws and reducing legal complications.
Changes in income tax slab are being considered:Under the new tax structure, the Finance Bill provides 2025 updated income tax slab:
Revenue ₹ 4,00,000: up to 0%
₹ 4,00,001 to ₹ 8,00,000: 5%
10% 8,00,001 to ₹ 12,00,000
15% ₹ 12,000,000 to ₹ 16,000,000
20% ₹ 16,00,001 to ₹ 20,000,000
25% ₹ 20,00,001 to ₹ 24,000,000
Over ₹ 24,000,000: 30%
New governance. Also allows for a standard deduction of 75,000.
Section 87A exemption:Under Section 87A, correspondence will be available for taxpayers with income of up to ₹ 12 lakh, which means that they will not have any tax responsibility. A former cap of ₹ 7 lakh has been raised.
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Additional Provision of New Income Tax Bill 2025:
Cut extension: Section 80CCD (1B) deduction for pension payment and Section 80IAC cuts for startup allowances are now available by 2030.
NRI Proposed Plan: NRI operating firms engaged in electronic manufacturing or services are now eligible under a new estimate system. New Income Tax Bill 2025
Municipal tax cuts: Two houses are now eligible for municipal tax deduction for self-conscious houses.Amended Return Submission: The 24 -month period has been extended by 48 months to submit revised returns.
Benefits required: New Income Tax Bill 2025
Promotional compliance: Taxpayers should be easy to follow tax laws as a result of simplified rules, which can increase the percentage of voluntary compliance.
Decreased litigation: The goal of this law is to reduce the lack of clarity which is often the result of legal conflicts between taxes and taxpayers.When tax laws are clear and simple, transparency increases, which helps taxpayers in better understand of their rights and responsibilities.
It is estimated that Parliament will soon get the revised Income Tax Bill 2025. The current Income Tax Act of 1961 will be replaced if it has been approved, and the government plans to implement the new law in the financial year 2025-2026. It is estimated that these reforms will increase compliance, encourage investment and accelerate economic growth. Taxpayers should consider careful changes and adjust their financial plans as required.
