- The new Income Tax Bill, introduced on Feb 13, will be discussed in the Monsoon Session.
- The bill aims to simplify tax laws, reduce compliance burdens, and introduce digital asset taxation.
- Prasad at religious places is now exempt from GST, providing relief to devotees.
The Indian government is set to overhaul its tax framework with a new Income Tax Bill, replacing the outdated 1961 Act. Finance Minister Nirmala Sitharaman confirmed that the bill, introduced in Parliament on February 13, is currently under review by a Select Committee.
A key highlight of the reform is the introduction of the “tax year” concept, replacing the assessment and previous year classifications. The bill also integrates cryptocurrency and other virtual digital assets into the capital gains tax structure.
Revamping India’s Tax System: A Major Overhaul
The new bill seeks to modernize India’s tax laws by streamlining tax filing processes and ensuring fairness in taxation. With a reduction in the number of sections from 819 to 536, the bill aims to make tax compliance simpler and more transparent. The introduction of a taxpayer charter further enhances accountability, defining the rights and responsibilities of citizens dealing with the tax department.
Apart from simplifying tax structures, the bill also seeks to regulate emerging financial assets like cryptocurrency. By classifying virtual digital assets as capital assets, the government intends to bring clarity to taxation policies surrounding digital transactions. The bill also introduces a higher tax-free income threshold, making it more beneficial for salaried individuals.
The government’s decision to exempt prasad distributed at religious places from GST has been well received, as it aligns with efforts to ensure that religious and charitable activities remain free from unnecessary taxation. This move is expected to reduce administrative burdens on religious institutions and make compliance smoother.
The new tax reforms also address concerns regarding tax evasion and fraud. The bill empowers tax authorities with advanced digital monitoring tools while ensuring safeguards for taxpayers’ privacy and rights. This balanced approach aims to create a fairer, more efficient tax system.
India’s new Income Tax Bill represents a significant step toward a more streamlined, transparent, and fair taxation system. With new provisions benefiting taxpayers and businesses alike, the reform marks a crucial evolution in the country’s economic policies.
“The hardest thing in the world to understand is the income tax.” – Albert Einstein
