No Change in LTCG Tax Rates in Income Tax Bill 2025, Clarifies IT Department

Amid growing speculation in various media outlets regarding a potential change in long-term capital gains (LTCG) tax rates under the proposed Income Tax Bill, 2025, the IT department has issued a clarification categorically stating that no changes in tax rates are being proposed in the draft legislation.

Recent media reports have claimed that the new Bill may introduce revised LTCG tax rates for certain categories of taxpayers. However, the department has dismissed these claims, emphasizing that the core objective of the Income Tax Bill, 2025 is to simplify language, modernize tax provisions, and remove redundant or obsolete clauses in the current Income Tax Act, 1961.

Key Clarifications

• No Change in Tax Rates: The Bill does not propose any alteration to existing income tax slabs or LTCG rates.
• Focus on Simplification: The primary aim is to make the law more readable and user-friendly without altering the substantive provisions.
• Redundant Provisions Removed: Several outdated sections have been identified for removal or streamlining in the new Bill.
• Ambiguities to be Addressed: Any confusion or misinterpretation around the draft will be clarified during the legislative process, the government assured.

There are news articles circulating on various media platforms that the new Income Tax Bill, 2025 proposes to change tax rates on LTCG for certain categories of taxpayers.

It is clarified that the Income Tax Bill, 2025 aims at language simplification and removal of…

— Income Tax India (@IncomeTaxIndia) July 29, 2025

A senior official from the Ministry of Finance noted, "The Income Tax Bill, 2025 is part of the long-awaited overhaul of India's direct tax laws. It is being wrongly interpreted as a proposal to raise taxes on capital gains. We urge taxpayers and media to await the official text and debates in Parliament."

The draft of the Bill is currently under review and will be tabled in Parliament in the upcoming session for discussion and approval. The government has reiterated its commitment to transparency, predictability, and stability in taxation, which are vital for investor confidence and economic growth.

Taxpayers, professionals, and financial market participants are advised to rely on official notifications and parliamentary proceedings rather than speculative media coverage.