Government withdraws Income Tax Bill 2025, new bill to be introduced on August 11

The Cabinet has withdrawn the Income Tax Bill 2025 to incorporate Select Committee recommendations and avoid legal ambiguities. A revised bill, replacing the 1961 Act, will be introduced on August 11, 2025, aiming to simplify and modernize tax laws. The move reflects the government’s commitment to transparent and efficient tax reforms.

New Delhi: An important decision has been taken in the Cabinet meeting chaired by Prime Minister Narendra Modi. The Central Government has decided to withdraw the Income Tax Bill 2025 introduced in the Lok Sabha on 13 February 2025.

The bill was sent to the Select Committee for scrutiny on the same day, which presented its report in the Lok Sabha on 21 July 2025. The government has accepted most of the recommendations of the committee, but it has been decided to withdraw it to include some new suggestions and make the bill more clear.

When will the new bill be introduced?

The government has announced that a revised income tax bill will be introduced in the Lok Sabha on 11 August 2025.**. This new bill will replace the Income Tax Act, 1961, which is being changed with the aim of modernizing and simplifying it.

Reason for withdrawing the bill

According to government sources, the main reason for withdrawing this bill is to avoid legal confusion.**. Since several versions of this bill were under discussion, the government decided to introduce a new and clearer draft. The new bill will be prepared keeping in mind the recommendations of the Select Committee and the suggestions of stakeholders.

What will change in the new bill?

Income tax laws will be simplified and modernized. Recommendations of the Select Committee will be incorporated. While retaining the basic structure of the existing Income Tax Act, 1961, it will be made more user-friendly.

This move of the government shows that it is serious about tax reforms and is redrafting the bill to avoid legal ambiguities. The new bill will be introduced in August, after which it will be discussed in detail in Parliament. This reform is considered an important step towards making the country's tax structure more transparent and effective.

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