New Income Tax Bill: Select Committee meets in Parliament | Today news

The select committee of the Lok Sabha Headed by Bharatiya Janata Party (BJP) MP Baijayant Panda on the Income-tax bill 2025 met at the parliament house annexe in the national capital on Wednesday.

The 31-Member Select Committee of Lok Sabha MPS is Examining The New Income Tax Bill, Which AIMS to Simplife Tax Laws, Modernise Definitions, and Provide More Clarity on Various Tax-Aon Various Tax-ANI Various Tax.

This new bill, tabled in Lok Sabha by Union Finance Minister Nirmala Sitharaman on February 13, seeks to replace the existing income tax act, 1961 and introduce changes Taxpayers, including individuals, businesses, and non-protrofit organisations.

After presenting the income tax bill, the finance minister asked the Lok sabha speaker to nominate members for a standing committee to review the newly tabled income tax bill.

Changes in New It Bill

One of the significant changes in the new bill is the introduction of simplified language and modern terminology. It replaces outdated terms and brings in new ones to align with today’s economy.

For example, it introduces the term “tax year” instead of the existing terms like Financial Year and Assessment Year Systems. It also defines “Virtual Digital Asset” and “Electronic Mode”, Reflecting the Growing Importance of Digital Transactions and Cryptocurrency in Today’s Financial Landscape.

In terms of the scope of total income, the new bill makes certain classes while maintening the existing tax printers.

Under the Previous Law, Sections 5 and 9 of the Income Tax Act, 1961, Stated that Indian Residents Ware Taxed on Their Global Income, While Non-Residents WERESIDED only on the Income Earned In India.

The New Bill, In Clauses 5 and 9, Retains This Rule But Provides a clearer definition of deamed Income, Such as Payments Made to Specific Individuals, Making Tax Rules More Non-Residents.

The new bill, under clauses 11 to 154, consolidates these deductions and introduce new provisions to support startups, digital businesses, and renewable energy investments.

Changes have also also been made to the term capital gains tax. Under the Previous Law, Sections 45 to 55A Categorized Capital Gains Into Short-Term and Long-term based on Holding Periods, with special tax rates for secondies.

The New Bill, In Clauses 67 to 91, Keeps the Same Categorization but introduce explicit provisions for virtual digital assets and updates beneficial tax rates. This ensures that digital assets, such as cryptocurrency, are covered under a proper tax framework.

For Non-Profit Organizations, The Previous Law, Under Sections 11 to 13, Provided Income Tax Examptions for Certain Charitable Purposes but Had Limited Compliance Guidelines.

The new bill, in Clauses 332 to 355, Establishes a More Detailed Framework, Clearly Defining Taxable Income, Compliance Rules, and Restrictions on Commercial Activities. This Introduces a Stricter Compliance Regime while also providing well-deefined examptions.

Overall, The Income Tax Bill 2025 AIMS to Simplife Tax Laws, Encourage digital and Startup Investments, and Bring Greater Clarity in Taxation Policies for Busines and Non-PORFITS.

The government beLieves these changes will make tax compliance emar while ensuring a Fair Tax Structure for all Categories of Taxpayers.