Union Finance Minister Nirmala Sitharaman will present the updated version of the Income Tax Bill, 2025 in the Lok Sabha today, 11 August. This new version includes changes suggested by a Select Committee of Parliament.
Why was the earlier bill withdrawn?
The original Income Tax Bill, 2025 was first introduced in February this year to replace the old Income Tax Act, 1961. However, last week, Sitharaman withdrew it from the Lok Sabha to avoid confusion caused by having multiple versions.
The government decided it was better to bring a fresh version with all suggested changes included, instead of introducing several separate amendments. The Select Committee, led by BJP MP Baijayant Panda, suggested 285 changes, all of which have been accepted.
Key changes in the revised bill
- Tax Refund Rules – The earlier version said taxpayers could not get refunds if they filed returns late. This restriction has now been removed. Under the new bill, refunds can be claimed as long as they are requested while filing the return.
- Inter-Corporate Dividends – The updated bill now includes the Section 80M deduction for inter-corporate dividends for companies using the special tax rate under Section 115BAA. This was missing in the earlier draft.
- Nil TDS Certificates – Taxpayers will now be allowed to apply for NIL TDS (Tax Deducted at Source) certificates.
What’s next?
The revised bill, which simplifies the language and ensures all technical changes are included, will be introduced in Parliament today for discussion and approval.
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