ICAI Welcomes New Income Tax Bill for Promoting Investment and Simplifying Tax Regime

Last updated: 16 August 2025


The Institute of Chartered Accountants of India (ICAI) has welcomed the newly passed Income Tax Bill, describing it as a simple and clear tax framework that will enhance ease of doing business and help position India as a preferred global investment destination.

Parliament on Tuesday approved the new bill, which will replace the six-decade-old Income Tax Act, 1961 and come into effect from April 1, 2026. ICAI confirmed that the legislation incorporates a large number of recommendations from the Parliamentary Select Committee, which engaged with ICAI and other stakeholders during consultations.

ICAI Welcomes New Income Tax Bill for Promoting Investment and Simplifying Tax Regime

According to ICAI, around 90 of its suggestions have been included in the bill. Key among them are:

  • Applicability of the Alternative Minimum Tax (AMT) only to those who have claimed specified income-based or investment-linked deductions.
  • Removal of the requirement to file a return on or before the due date solely for claiming a refund.
  • Clarification on the year of allowability of expenditure when tax deduction happens in a subsequent year.
  • Applicability of the 6% presumptive tax rate for receipts in online mode up to the due date of return filing.

"By streamlining the structure and provisions, the new bill reflects the government's commitment to providing a simple and transparent tax framework. This will significantly enhance the ease of doing business and strengthen India's appeal as a favoured investment destination," ICAI said in its statement.

The bill is being seen as a major step in modernising India's direct tax system, addressing long-standing industry demands for simplification, clarity and reduced compliance burdens.




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Finance news reporter covering taxation, GST, income tax, business compliance, and economy updates. I simplify complex financial topics into easy-to-understand articles for professionals, taxpayers, and business owners on leading finance and tax platforms.


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