Income Tax Bill: The central government has made a major decision. On Friday, the Income Tax Bill, 2025, was withdrawn from the Lok Sabha (Income Tax Bill Withdrawn). In short, the Modi government at the center has taken a historic step. On this day, Finance Minister Nirmala Sitharaman sought permission to withdraw the Income Tax Bill, 2025, as per the report of the Select Committee. After receiving the approval of the Parliament, the Finance Minister withdrew the bill. This move signals a major change in the country’s tax system, creating widespread curiosity among the general taxpayers.
Why was the bill withdrawn?
The government has stated that this bill was originally planned to replace the Income Tax Act, 1961. The bill was introduced on February 13, 2025, and was sent to the Lok Sabha’s Select Committee for review. The Select Committee submitted its report to the Parliament on July 21, 2025. According to sources, the old bill has been withdrawn to incorporate several important recommendations made by the Select Committee into a new bill. The government aims to introduce a more advanced, simple, and modern income tax law that will be convenient for taxpayers and supportive of the country’s economic progress.
What could be in the new bill?
Although the full details of the new bill have not yet been released, some potential changes have been indicated. The following aspects may be prioritized in the new bill:
- Simple Tax Structure: The tax slabs and rates in the new bill may be made simpler and more straightforward, so that ordinary people can easily calculate their taxes.
- Digitalization: Emphasis may be placed on making the tax payment process completely digital and completing all procedures online.
- Review of Deductions and Exemptions: The various deductions and exemptions in the current tax system may be reviewed to make them more rational.
- Business-Friendly Policies: Tax policies for new and small businesses may be simplified, which will help increase investment and employment in the country.
What does this mean for the general public?
The withdrawal of this bill is very important for the general taxpayers. Some of its potential effects are discussed below:
- End of the wait: The long wait for a new income tax law is about to end. A new and updated income tax bill may be introduced in the Lok Sabha on the upcoming August 11.
- Potential benefits: If the tax structure is simplified and tax rates are reduced, then ordinary salaried individuals and business owners will benefit.
- Policy transparency: A new and transparent law will help reduce tax evasion and increase government revenue, which will be used for the country’s development.
Overall, this step by the government is being seen as a positive change. Now, the wait is for the new bill, which is expected to give a new direction to India’s tax system. Taxpayers should keep an eye on the details of the new bill and prepare their financial plans accordingly.
