Income Tax Overhaul: New Bill on Horizon as Government Responds to Select Committee Recommendations

Finance Minister Nirmala Sitharaman withdrew the Income Tax Bill, 2025 and plans to introduce a revised version incorporating Select Committee recommendations. The updated legislation seeks to replace the 1961 Income Tax Act. Key changes focus on tax exemptions for religious trusts and conditions for anonymous donations.

Devdiscourse News Desk | New Delhi | Updated: 08-08-2025 15:53 IST | Created: 08-08-2025 15:53 IST

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In a significant move, Finance Minister Nirmala Sitharaman has withdrawn the Income Tax Bill, 2025, from the Lok Sabha. This decision comes with a commitment to introduce a revised version that includes key recommendations from the Select Committee.

The updated Income Tax Bill, expected to be tabled in the Lok Sabha on August 11, aims to address various concerns by integrating most of the committee's suggestions, marking a substantial update from the existing 1961 Income Tax Act.

Recommendations include continuing tax exemptions for anonymous donations to purely religious trusts, with stipulations for those engaged in additional charitable functions. Taxpayer-friendly measures like TDS refunds after due dates without penalties are also proposed to be part of the new legislation.

(With inputs from agencies.)