Cabinet okays bill to replace Income Tax Act, may be tabled in parliament soon
Subscribe to enjoy similar stories. The Union cabinet on Friday approved a bill to replace the more than six-decade-old Income Tax Act,1961 with a new, simpler and easy-to-understand law, as part of the government's regulatory reforms.
The Income Tax Bill is likely to be tabled in parliament shortly, and may be referred to a parliamentary committee for further discussions, according to two persons aware of the development. The new Income Tax Bill is a key element of the regulatory reforms announced by finance minister Nirmala Sitharaman in her budget speech on 1 February, which outlined the reforms meant to add momentum to India’s economic development.
There was, however, no official word on this decision. The cabinet also decided to restructure the central government's Skill India programme and continue it till 2026 with an outlay of ₹8,800 crore, railway, IT, and Information & Broadcasting minister Ashwini Vaishnaw said while briefing reporters about the cabinet decisions.
The new tax bill will be clear and direct in text, with close to half of the present law, in terms of both chapters and words, the minister had said in her speech, assuring that it will be simple to understand for taxpayers and the tax administration, leading to tax certainty and reduced litigation. Queries emailed to the finance ministry and to the Central Board of Direct Taxes seeking comments remained unanswered till press time.
Experts said they are looking forward to a more concise income tax law bereft of redundant provisions. Based on Sitharaman’s budget speech and explanations from officials, it is likely that the new Income Tax Bill will not have substantial changes in tax rates and charging provisions, but is meant to make the law simpler
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