Income Tax Bill 2025 Passed In Lok Sabha, Here’s What Has Changed

The Lok Sabha on Monday afternoon passed the modified Income Tax Bill, 2025, along with the Taxation Laws (Amendment) Bill, 2025. Members approved the Income Tax (No. 2) Bill, 2025, shortly after Finance Minister Nirmala Sitharaman introduced the revised version. The House passed the legislation to consolidate and amend income tax laws, replacing the Income Tax Act, 1961.

Following the passage of the bill, the Lok Sabha adjourned for the day. The legislation now awaits approval from the Rajya Sabha before seeking the President’s assent.

Finance Minister Introduces Revised Bill With Committee Recommendations

Finance Minister Nirmala Sitharaman introduced the modified Income Tax Bill in the Lok Sabha after incorporating most of the Select Committee’s recommendations. “Almost all of the recommendations of the Select Committee have been accepted by the government. In addition, suggestions have been received from stakeholders about changes that would convey the proposed legal meaning more accurately,” stated the statement of objects and reasons of the bill.

The revised legislation aims to simplify tax laws and improve clarity in legal interpretation.

Bill to Replace Income Tax Act, 1961

The new Income Tax Bill, 2025, seeks to replace the existing Income Tax Act, 1961, by consolidating and amending all related laws. Lawmakers debated the provisions before passing the revised bill. The government said it included stakeholder feedback to ensure the proposed law accurately reflects its intended meaning. Once passed by the Rajya Sabha, the bill will be sent to the President for approval, completing the legislative process.

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