On 12 August 2025, Parliament passed the Income-Tax Bill, 2025, replacing the Income Tax Act of 1961. The new law, effective from 1 April 2026, aims to simplify tax administration by reducing sections from 819 to 536, cutting chapters from 47 to 23, and introducing a single “tax year.”
It provides taxpayer reliefs such as late refunds, shorter TDS correction limits, and clearer pension/gratuity deductions, without changing tax rates. Drafted in six months and reviewed by a Parliamentary Select Committee chaired by Baijayant Panda, the bill was passed by voice vote despite an Opposition walkout.
