The New Income Tax Bill is now available and will be presented to the Lok Sabha by Union Finance Minister Nirmala Sitharaman. The decades-old Income Tax Act of 1961 will be replaced by this. With 536 sections and 16 (XVI) schedules, the bill is expected to become the Income Tax Act of 2025.
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During the Budget 2025 Speech, Finance Minister Nirmala Sitharaman said that the new tax bill would uphold the spirit of “Nyaya” (justice), much like the Bharatiya Nyay Sanhita, which took the place of the Indian Penal Code in July 2024. She emphasised that the bill will be straightforward and unambiguous, with almost half of its provisions being new, with the goal of reducing litigation and bringing about predictability.
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It is anticipated that the New Income Tax Bill 2025 will have a major impact on Indian taxpayers.
Different sectors may be impacted differently by the elimination of exemptions and the simplification of tax regulations. For example, Kerala’s real estate market, which has seen varying demand, may face adjustments in tax obligations, which could have an impact on investment choices and real estate values.
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Simplifying Legal Language: By employing plain language, the measure aims to make tax rules easier to understand, reducing the need for specialised legal expertise and facilitating better, simpler citizen compliance.
Tax Slab Reduction: In an effort to decrease taxpayers’ burdens and promote greater disposable income, the new tax regime reduces tax rates at all income levels.
Trust-Based Self-Assessment : The measure aims to increase taxpayer confidence while guaranteeing compliance with tax laws by using a “Trust First, Examine Later” stance.
No New Taxes: The bill seeks to streamline current tax rules in order to provide stability and predictability for both individuals and businesses, rather than proposing new taxes.
Budget Announcements Incorporated: To provide a consistent framework for taxpayers, the bill incorporates significant tax changes that were announced in the national budget, such as adjustments to income tax rates and rules pertaining to Tax Deducted at Source (TDS).
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The bill’s focus on ease of compliance may also result in more tax collections and improved enforcement, which could have an effect on Kerala’s government’s expenditures on public services and infrastructure.
Stakeholders throughout the state are keeping a careful eye on the bill’s progress as it moves through Parliament in order to fully comprehend its implications for the state’s economy and personal finances.
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