Nirmala Sitharaman to unveil new Income Tax Bill next week
New Delhi, Feb 1, 2025
Sitharaman reiterated the Finance Ministry's commitment to a taxpayer-friendly approach, stating, "The tax department will trust first, scrutinise later," as she announced the upcoming income tax code
While presenting the Union Budget 2025 on Saturday, Finance Minister Nirmala Sitharaman announced the government’s plan to introduce the Income Tax Bill along with multiple tax reforms aimed at maximising returns for all taxpayers. She confirmed that the new Income Tax Bill will be unveiled next week.
Sitharaman reiterated the Finance Ministry’s commitment to a taxpayer-friendly approach, stating, “The tax department will trust first, scrutinise later,” in the upcoming income tax code, which is set to be announced next week. She also emphasised that multiple tax reforms will be introduced to enhance returns for all taxpayers.
Highlighting the government’s decade-long efforts in tax reforms, she pointed to key initiatives such as faceless assessment, the taxpayer charter, and faster return processing, noting that nearly 99 per cent of returns are now based on self-assessment. Reaffirming the tax department’s stance of “trust first, scrutinise later,” she underscored the commitment to simplifying compliance.
As part of this ongoing reform agenda, Sitharaman reiterated that the new income tax bill will be introduced next week. She added that the new income tax bill is crafted to be clear and straightforward, ensuring simplicity and ease of understanding for both taxpayers and tax administrators. Its concise language is intended to reduce confusion, making it more accessible and user-friendly for all parties involved.
This bill is anticipated to be based on the Direct Tax Code (DTC), which aims to replace the current Income Tax Act of 1961 and simplify tax compliance for both individuals and businesses. The proposed changes are expected to be substantial, with the goal of reducing the complexity of the Income Tax Act by up to 60 per cent, making it more user-friendly for taxpayers.
From the middle class to corporate India, there is growing anticipation of tax relief or incentives as she presents her eighth consecutive Union Budget. Amid the current economic scenario, taxpayers are looking forward to measures that provide financial relief and stimulate growth. As part of the review, a proposal has been made to eliminate seven tariff Customs rates.
[The Business Standard]
