New Income Tax Bill 2025 Passed | What Are The Major Changes?

Welcome to StayInform In today’s article, we will know about the New Income Tax Bill 2025 Passed. Finally, after the budget, the bill that was being discussed a lot has been passed in the Lok Sabha. We are talking about the Income Tax Bill. As you all know, the government has withdrawn the first Income Tax Bill that was introduced in the Parliament and brought a new bill.

New Income Tax Bill 2025 Passed

But the problem is, this bill was again passed in the Parliament without any debate because the opposition was raising voices about the voter list. The voices were raising voices about the voter list. The Lok Sabha has passed the new Income Tax Bill, during that time without any debate.

What Has Changed?

We will know it in detail. We will understand what issues have been passed in this new Income Tax Bill. What has changed? Why should you know this? There is something to know.

So let me tell you, it will replace the Income Tax Act of 1961. And if you look here, actually, when the government initially brought it, the government said that it would be a simple law. And if you look at its acronym, S stands for Streamlined Structure and Language, I stands for Integrated and Concise, M stands for Minimised Mitigation, P stands for Practical and Transparent, L stands for Learn and Adapt, and along with that stands for Efficient Tax Reform.

Law of Income Tax.

Generally, we all know that this whole law of income tax is very complex. There are many things that the common man does not understand.

And this has been going on for decades. Is the law of 1961 still relevant today? And that is why the government wanted all these lawsuits, when there are complex matters, there are many problems between the government and the taxpayers. And the matter ultimately goes to court.

You all know that our courts are already very burdened. Now, going to court again and again on small matters, it costs money, it wastes time. So the government has said that this new law should be brought, which should be simple.

Finally The Government Brought It

It has also been passed in the Lok Sabha. In fact, I am showing you. When this year’s budget came in 2025-26, which was announced by Nirmala Sathyaman on February 1, we will bring a new law on income tax.

And finally on February 13, 2025, a new bill was introduced in the Lok Sabha. But whenever any big bill comes, it eventually goes to the committee. So the Lok Sabha Election Committee, which was chaired by MP Vijayanta Pandey, this entire committee was looking after it under his leadership.

We spoke to many stakeholders. And after many months, after detailed examination, a report was presented here. And it was said that we need many changes.

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In fact, if you see, this committee gave 285 suggestions. The new bill that the government is bringing, it is called a simple government, but we still have to amend it. So you think, 285 suggestions were given.

Nirmala Sitaraman Said

that we have accepted almost all the suggestions. And after so many changes, the government wanted to withdraw the old 13th February bill. And wanted to bring a new bill.

So on 8th August, Nirmala Sitaraman withdrew the old bill from the Lok Sabha. And on 11th August, the government brought a new bill. And finally it was passed by the Lok Sabha.

But it is important for us to know what changes are being made in it. There are many things, but there are some important things that you should know. First of all, let me tell you that the bill has been simplified.

Its language has been simplified so that even the common man can understand it. That is, you understand, earlier it had about 800 clauses. It has been reduced to about 536.

The Bill Has Been Reorganized Into 23 Chapters.

And its total word count has been reduced dramatically. And the language has been simplified to get more clarity.

So the biggest change is the structure and drafting. The second is its terminology. You must have seen it, especially those who file income tax returns.

So you all know that there are many such terms in it. For example, tax year. Sorry, tax year is being brought now.

This financial year is for 2025-2026. But you have to pay income tax for the previous year. So we used to call it the previous year.

We have to file income tax for 2024-2025. When do you do it? In 2025-2026. And we call the assessment year 2025-2026.

So there was a lot of confusion because of this. What is 2024-2025? What is 2025-2026? So finally, what has the government done here? All of that has been removed. Here the government is saying that we will say one simple thing.

About  The Tax Year.

Tax year means the year in which you have to pay tax. For which year are you filing the return for this year? For the year 2024-2025.

That means there will be a single tax year. Whichever year you file income tax, the year in which you have to pay income tax, we will call it the tax year. So the year 2024-2025 will be called the tax year.

And suppose you have to file the return in 2026-2027, what will you do? If you do it for the year 2025-2026, then we will call it the tax year. We will do this kind of work. Then, there was a lot of confusion here.

Change In The Tax System

Look, here the government is bringing a new bill. Which is repealing the Income Tax Act of 1961 and bringing a new law. So here it does not mean that there will be any change in your tax structure.

You have to remember that in the budget that came earlier this year, Nirmala Sitharaman has already given you tax exemption up to Rs 12 lakh. So it will remain the same. There will be no change in it.

Basically, this entire bill is being brought so that the entire law can be simplified. So you have to remember this main point. Then your procedural modernization.

Look, today is the digital age. Even now, officials do not directly reach your house. Do not search for useless things.

So most of the things, whatever the assessment and consent system is, it is being made faceless and digital first. Meaning human interface should be as less as possible. Transparency should be brought.

Don’t Bother With Useless Things.

Don’t bother honest taxpayers. For this reason, most of the things have been made faceless.

So that if you have any problem here, if the government thinks that you have to pay some more tax, the government will just send you an email or a message. It will ask you to submit it. If you have any problem, you can reply.

You don’t have to meet officials again and again. So this is an important thing that is being done. Then you have strong taxpayer protection.

See, what I told you, the government brought the first bill. In it, the government said that if an anonymous donation comes to a religious fund, suppose it is a temple. So if an anonymous person donates Rs 1 crore, then donate Rs 10 lakh.

So the government said in the last bill that you have to pay tax on that too. Because he is anonymous. I don’t know who is giving it.

But here the committee said that it should not be like this. Because there was a backlash on it. There was a lot of pressure on the government too.

Anonymous Donations

So finally, the new bill that the government has brought, anonymous donations, it says that if it is purely for religious trusts, then the government will not levy any tax on anonymous donations. But yes, if there is any other charitable trust, for example, related to education, schools, hospitals, so if there is an anonymous donation coming in, if the money is coming from an unknown person, then you have to pay tax there. So that is an important distinction that you have to remember.

Late Filing of Income Tax Returns

Okay, I was telling you one more thing here, strong taxpayer protection. So basically, one more thing was happening in this, let’s say you file your income tax return late. And you should get a refund.

Let’s say you have already paid Rs 10 lakh tax to the government. But at the end, your tax is only Rs 8 lakh. So you should get a refund of Rs 2 lakh.

So what did the government say in the first bill, if you file your return late, you can lose Rs 2 lakh. We will not give you the return that you have to give. You file it on time.

But there was also a reaction that due to some obligation, suppose someone files their income tax return late. So it should not happen that he has paid advance tax, you deduct it from it. So it should not happen.

So you should also get a refund. Even if you file it late. You have to suffer a small penalty for filing it late.

You take it. But at least the advance tax should be refunded, at least you give it. This is an important issue.

Conclusions

The previous bill was quite complicated, so it is necessary to bring a new bill. Hopefully, this new bill will solve many problems of the common people. There will be no change in the income tax slab with the new bill. On the other hand, the new bill will solve some complex problems.