New Income Tax Bill 2025: Finance Minister Nirmala Sitharaman on Thursday tabled the new Income Tax Bill in Lok Sabha citing it a S.I.M.P.L.E. Bill. The new law will take effect from next year April 1, 2026. Here are 10 facts that you must know about the Bill:
New Income Tax Bill 2025 Key Take Aways
1. The New Income Tax Bill 2025 replaces the 1961 Act that came into effect in 1962.
2. The new Income Tax Law will come in force from April 1, 2026.
3. The sigh of relief is that it will not change the existing tax slabs.
4. The Finance Ministry has called it a S.I.M.P.L.E. Bill to follow and enforce.
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5. S.I.M.P.L.E. is elaborated as Streamlined structure and language, Integrated and concise, Minimised litigation, Practical and transparent, Learn and adapt, and Efficient tax reforms”.
6. The new law will replace the current tax system of financial year taxing. Instead, the tax will be paid in the same calendar year in which the income is earned.
7. The new Income Tax law has also omitted some sections like fringe benefit tax. Fringe benefits are given to employees by their employers.
8. The earlier law had 819 sections while the new Income Tax law will have 536 sections, 23 chapters and 16 schedules within 622 pages.
9. According to the Union Budget 2025, individuals whose remuneration is up to ₹12 lakh will not have to pay tax.
10. The Budget has also tweaked the tax slabs for the new regime, adding a 25% bracket for salary within the ₹20 lakh to ₹24 lakh category.
