I-T Bill To Phrase In ‘Tax Year’ Concept

New Delhi: The simplified Income-Tax Bill 2025, which brings in the concept of ‘tax year’ and abolishes the archaic and complicated terms ‘previous’ and ‘assessment years’, is likely to be introduced in Parliament on Thursday.

The Bill comprises 536 sections, 23 chapters and 16 schedules in just 622 pages. It does not bring in any new taxes, but only simplifies the language of the existing Income-Tax Act, 1961. The six-decade old legislation has 298 sections and 14 schedules. It had 880 pages when the Act was introduced. The new Bill seeks to replace the Income-Tax Act 1961, which has become too voluminous due to the amendments made over the last 60 years.

The new law is expected to come into effect from April 1, 2026. The new bill has omitted redundant sections, like those relating to Fringe Benefit Tax. The Bill is free from ‘explanations or provisos’, thereby making it easier to read and comprehend. Also, the word ‘notwithstanding’, which was used excessively in the Income-Tax Act 1961, has been done away with in the new Bill and almost everywhere replaced with the term ‘irrespective’.

The Bill uses shorter sentences and has been made reader friendly with the use of tables and formulae.

Tables have been provided for provisions relating to TDS, presumptive taxation, salaries, and deductions for bad debt.