(MENAFN- Kashmir Observer) New Delhi- The government, in the ensuing Budget session of Parliament, is likely to introduce a new income tax bill which seeks to simplify the current I-T law, make it comprehensible and reduce the number of pages by about 60 per cent.
Finance Minister Nirmala Sitharaman in her July Budget had announced a comprehensive review of the six-decade old Income Tax Act, 1961, within six months.
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“The new Income Tax law will be introduced in the Budget session of Parliament. It will be a new law and not an amendment to the existing Act. Currently, the draft law is being vetted by the law ministry and it is likely to be brought in Parliament in the second half of the Budget session,”a source said.
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The Budget session is scheduled from January 31 to April 4. The first half (January 31-February 13) will start with President Droupadi Murmu's address to the joint sitting of Lok Sabha and Raya Sabha followed by the tabling of the Economic Survey for 2024-25. The Union Budget for 2025-26 will be presented on February 1.
Parliament will reconvene on March 10 and will sit through April 4.
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Pursuant to the Budget announcement by Sitharaman for a comprehensive review of the I-T Act, 1961, the CBDT had set up an internal committee to oversee the review and make the Act concise, clear, and easy to understand, which will reduce disputes, litigation, and provide greater tax certainty to taxpayers. Also, 22 specialised sub-committees were established to review various aspects of the Act.
Public inputs and suggestions were invited in four categories - simplification of language, litigation reduction, compliance reduction, and redundant/obsolete provisions.
The Income Tax Department has received 6,500 suggestions from stakeholders on review of the Act.
Sources said the provisions and chapters will be significantly reduced and the obsolete provisions will be deleted.
The Income Tax Act, 1961, which deals with imposition of direct taxes - personal I-T, corporate tax, securities transaction tax, besides gift and wealth tax - currently has about 298 sections and 23 chapters.
“The effort is to cut down the volume by about 60 per cent,” the source added.
Sitharaman had said in her July, 2024, Budget speech that the purpose of the review is to make the Act concise, lucid, easy to read and understand.
This will reduce disputes and litigation, thereby providing tax certainty to taxpayers. It will also bring down the demand embroiled in litigation. It is proposed to be completed in six months, she had said.
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