New income tax system: A big update has come regarding the tax system. The Finance Ministry is working on a new income tax system. Sources told India Today that the government’s aim is to simplify the tax system and process. Under the new system, 125 sections and sub-sections may be abolished.
New income tax system: A big update has come out regarding the tax system. The Finance Ministry is working on a new income tax system. Sources told India Today that the government’s aim is to simplify the tax system and process. Under the new system, 125 sections and sub-sections may be abolished.
India Today has received information from sources that the new Income Tax Act will soon be introduced to replace the old Income Tax Act, the scope of the new Income Tax Act is to simplify it. The Finance Ministry is considering the possibility of announcing it in the upcoming budget in February 2025. The Finance Minister is aiming to eliminate unnecessary sections and sub-sections from the Income Tax Act.
At present, the Finance Ministry is busy reforming the Income Tax Act, after which the revised ‘Income Tax Law’ will be brought before the country. If the new system comes, it can be a big change for the taxpayers. The Finance Ministry may eliminate unnecessary sections and sub-sections to simplify the tax process.
It is being considered that the tax system should be made as simple as possible. Prime Minister Narendra Modi is focusing on bringing more and more people under the tax net and this is the reason why the government has come up with a new tax system.
Feedback was sought under the new system
The ministry is reviewing the New Tax System and is consulting with experts. Meanwhile, it has also been learned that there has been a great response to make the process of filing taxes easier and simpler. Almost all the responses have requested to make tax filing easier and reduce the compliance burden.
This work will be completed in the next month
The work of reviewing and finalizing the new Income Tax Act will be completed in the coming months. The aim of the reform is to make the tax code more comprehensive, reduce the compliance burden and improve clarity for taxpayers. Under this change, new tables will be introduced for expenditure, investment, holding, property, liabilities, while a process of investigation for income source may also be introduced.
Income Tax Act 1961 came into force in 1962
It is worth noting that the Income Tax Act 1961 came into force on April 1, 1962 and is applicable all over India till date. In 2020, the government introduced a new tax system. For the financial year 2023-24 (assessment year 2024-25), 72% of taxpayers filed their returns under this new tax system.
When was income tax implemented for the first time in India?
Let us tell you that the income tax system in India was implemented in 1860 by Sir James Wilson, who was the Finance Minister of pre-independence India. This system was implemented to compensate for the financial loss suffered by the government due to the military rebellion of 1857.
