The Income Tax Department has launched an online self-help tool to assist taxpayers in navigating the proposed changes in the Income Tax Bill 2025. This innovative tool, accessible on the official Income Tax Department’s website, provides taxpayers with the ability to directly compare the provisions of the new bill against those of the Income Tax Act, 1961.
With the comparison tool, users can select a specific section from the current Income Tax Act via a dropdown menu. After making a selection, the corresponding clause from the new Income Tax Bill is displayed on the right-hand side. To further facilitate understanding, users can view the mapping in a table format.
The Income Tax Department recently announced the activation of this useful utility for comparing sections of the Income Tax Act, 1961, with the corresponding clauses of the new Income Tax Bill via a post on X.
Introduced in the Lok Sabha on February 13, 2025, the New Income Tax Bill aims to simplify the complexities associated with the Income Tax Act of 1961. Over the years, the Act has experienced numerous updates and modifications, especially through annual budgets.
One of the most notable enhancements in the new tax bill is the significant reduction in its word count, decreasing from 5.12 lakh words in the current Income Tax Act to just 2.6 lakh words in the proposed bill. This revision not only streamlines tax regulations but also makes them more comprehensible for taxpayers. The number of chapters in the Act has been reduced from 47 to 23, and the total sections have been decreased from 819 to 536.
A major change in terminology is the replacement of ‘assessment year’ and ‘previous year’ with the term ‘tax year,’ which signifies the 12-month period starting on April 1.
The readability of tax law has seen a notable improvement as the traditional legal jargon has been replaced with more accessible language. Sections that addressed multiple scenarios have been reformatted into enumerative lists, and wherever possible, tables have been utilized. For example, TDS provisions are now presented in a tabular form, and certain sections, such as Section 10—which previously included around 150 clauses—have been relocated to Schedules and reformatted as tables. This thorough revision has not only reduced the size of the new bill by nearly half but has also consolidated provisions for a more user-friendly approach.