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The New Income Tax Bill 2025 has been passed in the Lok Sabha, bringing significant tax relief to a wide range of taxpayers, including government employees, private sector staff, doctors, lawyers, artists, freelancers, and pension scheme subscribers. Finance Minister Nirmala Sitharaman introduced the revised bill, which aims to replace the Income Tax Act, 1961, and implement a modern, taxpayer-friendly system.
Key Highlights of the New Income Tax Bill 2025
The revised bill incorporates almost all recommendations made by the Lok Sabha’s Select Committee. Alongside the Income Tax Bill, the Taxation Laws Bill has also been passed, focusing primarily on providing tax exemptions for Unified Pension Scheme subscribers.
Major Changes in the Revised Bill
- Updated Income Tax Slabs & Rates: Significant changes have been made to tax slabs, especially benefiting the middle class. This will reduce their tax liability, leaving more disposable income in hand.
- Encouragement for Savings & Investments: The new structure promotes domestic savings and investment.
- Simplified TDS Refund Process: Taxpayers will no longer need to file a complete ITR just for TDS refunds; a simplified form will be used.
- Late Filing Refunds Allowed: Even if returns are filed late, taxpayers will now be eligible for refunds (previously restricted to a certain deadline).
- Zero TDS Certificate Facility: Taxpayers can now obtain a Zero TDS Certificate before tax deduction, ensuring their income remains untaxed at source.
Also Read: Lok Sabha Passes Two Key Tax Bills Without Debate Amid Opposition Protests
Who Will Benefit from the New Income Tax Bill?
The bill is designed to benefit a wide spectrum of professionals and employees, including:
- Government & Private Sector Employees without a company pension scheme.
- Doctors, Lawyers, Artists, and Freelancers who have invested in recognized pension funds.
- NPS Subscribers (National Pension System) – eligible for tax exemption benefits.
- Pension Beneficiaries in Approved Funds – If a pension account holder passes away, their nominee or dependent will receive the full amount tax-free.
- Group Insurance Linked Pension Scheme Members – Employees not directly working for an organization but benefiting from its approved pension fund will also be covered.
Impact on the Middle Class
With reduced tax rates and simplified refund procedures, the middle-class segment is expected to see more take-home income, boosting both household spending and overall economic growth.
Conclusion
The New Income Tax Bill 2025 is a major step towards simplifying India’s tax system while providing maximum relief to salaried individuals, professionals, and pensioners. With these changes, the government aims to encourage savings, promote investment, and ensure fair taxation for all income groups.
Karunakar Mohanta is the creator of OdiaYojana.in, a leading blog that provides the latest updates on government schemes, scholarships, and official notifications in Odia. With a mission to simplify complex government information, he helps Odia citizens stay informed and empowered. Follow him to stay updated on PM Yojanas, state benefits, and important deadlines.
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