Quick Summary
Finance Minister Nirmala Sitharaman on Tuesday addressed the Rajya Sabha, affirming that the central government has delivered on its July 2024 budget promise by introducing a simplified and modernised framework for India's tax laws. Speaking during a discussion on the Income-Tax Bill, 2025 and the Taxation Laws (Amendment) Bill, 2025, the Finance Minister emphasised that the reforms aim to reduce complexity, increase transparency, and eliminate ambiguities that have led to prolonged litigation.
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FAQ :
The main goal is to simplify and modernise India's tax laws, reduce complexity, increase transparency, and eliminate ambiguities that lead to prolonged litigation, without changing tax rates.
No, the Finance Minister has explicitly stated that the tax rates will not be changed. The reform focuses on simplifying the language and structure of the tax laws.
The Income Tax Bill, 2025, will replace the Income Tax Act, 1961, which has been in force for over six decades.
The number of sections has been reduced from 819 to 536, and chapters from 47 to 23. It also replaces lengthy legal text with 39 new tables and 40 formulas for easier interpretation and calculation.
The Taxation Laws (Amendment) Bill, 2025, was also passed to update related provisions across other tax statutes and align them with the new Income Tax framework.
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