The government will present an amended version of the Income Tax Bill, 2025, after Finance Minister Nirmala Sitharaman withdrew it from the Lok Sabha on Friday, August 8, sources familiar with the development told Zee Business. The decision has been taken to implement the modifications recommended by the Select Committee.
A new version of the Income Tax Bill, incorporating most of the recommendations made by the Select Committee chaired by BJP MP Baijayant Jay Panda, will be introduced in Parliament on Monday, the sources said.
To avoid confusion caused by multiple versions of the Bill and to provide a clear and updated version with all the changes incorporated, the new version of the Income Tax Bill will be introduced for the consideration of the House.
According to Panda, who chaired the Parliamentary Select Committee responsible for reviewing the legislation, the new law, once passed, will simplify India’s decades-old tax structure, cut down legal confusion, and help individual taxpayers and MSMEs avoid unnecessary litigation.
The new measures will play a significant role in creating a fair and equitable system of direct taxation that ensures no additional burden of direct taxes on the working and middle-class population of the country.
Slabs and rates have been changed across the board to benefit all taxpayers. The new structure substantially reduces the taxes of the middle class and leaves more money in their hands, boosting household consumption, savings, and investment, according to the government.
The Finance Act, 2025, has increased the income threshold for claiming a tax rebate under section 87A of the Income Tax Act, 1961 for resident individual taxable under the new tax regime under section 115 BAC of the Act from Rs 7 lakh to Rs 12 lakh, and the maximum rebate amount has been raised from Rs 25,000 to Rs 60,000.
Marginal relief as provided earlier under the new tax regime is also applicable for income marginally higher than Rs 12,00,000, as per the Finance Ministry. The new income tax bill will make filing taxes easier for common citizens and small businesses.
With inputs from agencies
