Finance Minister Nirmala Sitharaman announced on Saturday that she is expected to introduce the new income tax bill, which will replace the six-decade-old Income Tax Act, in the Lok Sabha next week.
Following its introduction in the Upper House, the bill will be referred to a parliamentary standing committee for further scrutiny. The Union Cabinet, led by Prime Minister Narendra Modi, approved the bill on Friday.
"Yesterday, the Cabinet cleared the New Income Tax proposal, I hope to have it introduced in the Lok Sabha in the coming week. Post that it will go to a committee," Sitharaman said a media briefing after addressing the post-Budget customary meeting with the central board of directors of the Reserve Bank of India (RBI).
Once the parliamentary committee submits its recommendations, the bill will be sent back to the Cabinet for approval. After receiving Cabinet approval, it will be reintroduced in Parliament. Responding to a query about the rollout of the new income tax law, Sitharaman stated, "I still have three critical stages to pass through."
Sitharaman had initially announced a comprehensive review of the Income-Tax Act, 1961, in the July 2024 Budget. To oversee this review, the CBDT set up an internal committee aimed at making the Act more concise, clear, and user-friendly, with the goal of reducing disputes, litigation, and providing greater tax certainty to taxpayers.