The Monsoon session of Parliament is set to commence on July 21 and conclude on August 12, during which several new bills are expected to be introduced. One of the most anticipated legislations is the New Income Tax Bill 2025.

The select committee of the Lok Sabha, currently reviewing the Income Tax Bill 2025, has put forward 285 suggestions. According to a committee member speaking to PTI, “We have made 285 suggestions to the Bill.”

These recommendations focus on simplifying the language of the draft legislation. The committee is scheduled to present its report in the Lok Sabha on July 21. Among the proposed changes are the following:

Proposed Changes by the Committee

  1. Income Tax Refund Provisions: The provision that denies income tax refunds for late-filed returns has been suggested for removal. Currently, the bill stipulates that individuals seeking refunds must file their income tax returns by the due date. Section 433 of the new IT bill indicates that refunds can only be requested during the filing of a return.
  2. Reinstatement of Section 80M: The suggested reinstatement of the repealed Section 80M, which allowed certain deductions for inter-corporate dividends for companies benefiting from the special rate under Section 115BAA, is another significant proposal. “This reinstatement will promote a more efficient Corporate Tax Structure and alleviate the tax burden on companies,” explains CA Pratibha Goyal, partner at PD Gupta & Co, a firm based in Delhi.
  3. NIL TDS Certificates: The committee also recommends that taxpayers be allowed to obtain NIL TDS certificates. Currently, the new Income Tax Bill provides only low TDS deduction certificates to taxpayers.

The Income Tax Act of 1961 has been effective since April 1, 1962, and has undergone 65 amendments, resulting in over 4,000 changes.

Overview of the New Income Tax Bill

The New Income Tax Bill prioritizes simplification, clarity, and ease of understanding. It features clear language, active voice, and concise sentences, eliminating redundancy and complex explanations. The bill comprises 2.6 lakh words and consists of 536 sections, with the total number of chapters reduced to 23.

The objective of the new bill is to address the issues arising from interpretations by various courts, and it avoids cross-referencing, thereby reducing the need to consult multiple provisions to understand any single one.