India's Union Finance Minister Nirmala Sitharaman on Saturday (Feb 1) announced that she will be introducing the new income tax bill next week, which will overhaul the South Asian nation's taxation system.
While presenting her record eighth consecutive Budget, Sitharaman said the new bill will be clear and direct in text with close to half of the present law. It will be simple to understand, leading to tax certainty and reduced litigation, she said.
“The government will introduce a new Income Tax bill next week in Parliament to take forward 'trust first, scrutinise later' concept. New income tax bill will be half of the current volume; clear and direct in wording,” Sitharaman said in her Budget 2025 speech in Parliament.
The finance minister in her July Budget (which was an interim budget as the new government had taken charge after general elections) had announced a thorough overhaul of the Income Tax Act, 1961, with the goal of completing the review within six months.
New Income-tax Bill to be Introduced
— Ministry of Finance (@FinMinIndia) February 1, 2025
🔶 New bill will be clear and direct in text with close to half of the present law
🔶 Will be simple to understand, leading to tax certainty and reduced litigation#ViksitBharatBudget2025 #Budget2025 #UnionBudget2025 pic.twitter.com/dw78x6bMJP
She said that in the last decade, the government had come up with several reforms for the convenience of taxpayers, including faceless assessment.
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FM Sitharaman vows reforms across six vital domains, from taxes to regulations
Sitharaman has pledged to implement reforms across six vital sectors: taxation, urban development, mining, financial sector, power and regulatory reforms.
The budget also laid stress on the growing spending power of India's growing middle class.
"Union Budget 2025-26 with an effort to a. Accelerate growth b. Secure inclusive development c. Invigorate society and industry d. Uplift household sentiment and e. Enhance spending on power of India's rising middle class," she said.
Despite acknowledging the ongoing geopolitical challenges that could hinder global economic growth, the finance minister expressed confidence in India's robust economic foundations.
Sitharaman highlighted the government's vision of 'Sabka Vikas' (Development for All), which she said is aimed at balancing growth across all regions.
"Our economy is the fastest-growing among all major global economies. Our development track record of the past 10 years and structural reforms have drawn global attention. Confidence in India's capability and potential has only grown in this period. We see the next five years as a unique opportunity to realize 'Sabka Vikas', stimulating balanced growth of all regions," she added.
(With inputs from agencies)