Union Finance Minister Nirmala Sitharaman is expected to introduce the New Income Tax Bill in the Lok Sabha today. The Bill aims to replace the existing Income Tax Act, which has been in place for 60 years.
Speaking to the media on Saturday, Sitharaman confirmed that she plans to present the Bill in Parliament soon. Once introduced, it will be sent to a parliamentary panel for further review and discussions.
On Friday, the Union Cabinet, led by Prime Minister Narendra Modi, gave its approval for the new Bill.
Sitharaman first mentioned plans for a detailed review of the Income Tax Act, 1961, during her Budget speech in July 2024. The government says the new Bill will simplify direct tax laws, making them easier to understand and follow.
On February 1, while presenting the budget,the Finance Minister said the Budget aims at ‘transformative’ reforms in 6 areas including taxation, financial sector, power sector, urban development, mining, regulatory reforms.
In a big announcement and relief for the middle class, the FM said that no income tax was payable up to Rs 12 lakh under new income tax regime. Sitharaman provided relief to individual taxpayers by raising the income tax rebate limit from Rs 7 lakh to Rs 12 lakh. This rebate applies to resident Indian taxpayers, ensuring that salaried individuals earning up to Rs 12.75 lakh will now be exempt from paying income tax. Additionally, the minister announced a revision of tax slabs under the new regime, offering a significant savings boost to the middle class.