New Income Tax Bill Likely To Be Tabled In Parliament On Aug 11: Sources

The government is likely to table the new Income Tax Bill on Aug. 11 in the parliament, sources told NDTV Profit. Most suggestions from the select parliamentary committee are being accepted. The key amendments in the bill include revised capital gains rules for LLPs, changes to corporate dividend deductions and no TDS on specified transactions.

In total, the parliamentary panel has recommended 285 changes, underlining the need for significant fine-tuning before the Bill is ready for passage. While the legislation is currently listed for tabling in the ongoing Monsoon Session, sources indicate that it may now be pushed to the Winter Session to allow more time for revisions.

The new Income Tax Bill of 2025 was presented in Parliament in February and subsequently forwarded to a parliamentary committee. The committee submitted its recommendations regarding the bill to Parliament on July 21.

The new bill gives tax officers powers to override the access code of computer systems and virtual digital space, including online trading and investment accounts as well as cloud servers, in search and seizure cases.

The simplified Income Tax Bill, which is half the size of the 1961 Income Tax Act, seeks to achieve tax certainty by minimising the scope of litigation and fresh interpretation, the Income Tax department had earlier said.

The new bill has a word count of 2.6 lakh, lower than 5.12 lakh in the I-T Act. The number of sections is 536 against 819 effective sections in the existing law. The number of chapters has also been halved to 23 from 47.

The Income Tax Bill 2025 has 57 tables compared to 18 in the existing Act and removed 1,200 provisos and 900 explanations. The new legislation will come into effect from April 1, 2026. The new Income Tax Bill is a crucial part of the government’s broader tax reform effort, aimed at overhauling and simplifying the decades-old Income Tax Act of 1961.