The Union Cupboard on Friday permitted the brand new earnings tax invoice, which is able to change the six many years outdated I-T Act, sources advised PTI. The laws shall be launched in Parliament subsequent week and can be despatched to the Standing Committee on Finance, the report added.
The brand new invoice seeks to make direct tax legislation easy to grasp and to not impose any new tax burden. It won’t have provisions and explanations or lengthy sentences.
Finance Minister Nirmala Sitharaman introduced in Finances 2025-26 that the brand new tax invoice shall be launched within the ongoing session of Parliament.
The minister had first introduced a complete overview of the Revenue-tax Act, 1961 in her July 2024 Finances.
The CBDT had arrange an inside committee to supervise the overview and make the Act concise, clear, and simple to grasp, which is able to cut back disputes, litigations, and supply higher tax certainty to taxpayers. Additionally, 22 specialised sub-committees have been established to overview the assorted points of the Revenue Tax Act, the report added.
Public inputs and solutions had been invited in 4 classes — simplification of language, litigation discount, compliance discount, and redundant/out of date provisions.
The earnings tax division has obtained 6,500 solutions from stakeholders on overview of the Revenue Tax Act.
Sitharaman’s large earnings tax reduction
Throughout her Finances 2025 speech, Nirmala Sitharaman introduced that these with salaries as much as ₹12 lakh every year pays nil earnings tax.
“The center class present strengths to the financial system. In recognition of their contribution, we now have periodically lowered the tax burdens. I’m now joyful to announce that there shall be no earnings tax as much as an earnings of ₹12 lakhs,” the minister stated.
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People incomes as much as ₹12.75 lakh in a yr won’t need to pay any taxes after she raised the exemption threshold from ₹7 lakh. She additionally altered tax slabs for individuals incomes above this threshold to assist save as much as ₹1.1 lakh in taxes for these with earnings as much as ₹25 lakh in a yr.
(With PTI inputs)
