NEW DELHI: The newly proposed Income Tax Bill 2025 passed by Lok Sabha on August 11 has received President’s assent on Friday.
The Bill tabled by Finance Minister Nirmala Sitharaman aims to replace the six-decade old Income Tax Bill 1961 and simplify the language and remove redundant provisions.
As per the notification, the new law will be effective from April 1 next year, unless stated otherwise.
The first draft of the Bill, tabled in February, had included Clause 263(1)(a)(ix), which restricted refunds only to taxpayers who filed returns within the prescribed due date. This provision has now been dropped.
The revised Bill has also addressed several doubts, including those related to inter-corporate dividend deductions for firms opting for concessional tax regimes. The updated legislation provides clarity on several issues raised after the February draft, spanning corporate income, rental income and other categories.
Further, the new Bill eliminates duplicative provisions and outdated terminology, cutting down the number of sections from 819 under the Income Tax Act, 1961, to 536, and trimming chapters from 47 to 23.