After Finance Minister Nirmala Sitharaman tabled Income Tax Bill 2025 in the Parliament, several experts and taxpayers supported the move. However, some expressed their reservations about it.
Sanjay Tolia, Partner at PwC, said the bill aims to simplify the country's tax system without making significant changes to the existing law. “Overall, this marks a transition towards a more modern tax system for both taxpayers and the administration,” Tolia said.
On the other hand, Vivek Jalan, Partner at Tax Connect Advisory Services, expressed doubt over the usefulness of the introduction of the ‘tax year’ concept in the bill.
“Due to the concept of ‘tax year’, there might be questions whether the period April 1, 2026 to March 31, 2027 would be in conflict between old and new acts. However, this is not to be as it will be Assessment Year 2026-27 of the Income-tax Act, 1961 and will pertain to the income of a taxpayer for the previous year 2025-26 and not to the income of the financial year 2026-27; It will be the tax year 2026-27 of the new Act. It will pertain to the income of a taxpayer for the financial year 2026-27,” Jalan said.
Anand Rathi Wealth's Deputy CEO Feroze Azeez said, “The government has also lived up to its promise of not making substantial changes compared to the existing law and most of the laws remain unchanged.”
{{/usCountry}}Anand Rathi Wealth's Deputy CEO Feroze Azeez said, “The government has also lived up to its promise of not making substantial changes compared to the existing law and most of the laws remain unchanged.”
{{/usCountry}}He added, “As you've heard us voice the need and expectation for simplification, that dream now seems to be turning into reality.”
“Stakeholders must carefully review the changes to understand their implications and plan for seamless compliance with the updated regulations,” said Anshul Khemuka, Partner at Khaitan and Co.
What the bill changed?
The new bill has simplified terminology and reduced the length and the bulkiness of the Income Tax Act 1961. It also removed privisos and explanations and has made referencing similar. This is a major step as often, taxpayers would get confused or may even be prone to fraud over their lack of proper understanding of the tax laws in India.
A major change is the introduction of the ‘tax year’ concept and the elimination of the ‘previous year’ and ‘assessment year’ concepts.