Finance Minister Nirmala Sitharaman on Friday withdrew the Income Tax Bill, 2025, in the Lok Sabha and said the government will come out with an updated version of the legislation after incorporating changes suggested by the Select Committee.
On August 11, the Lok Sabha will receive a new version of the Income Tax Bill. Sources claim that the majority of the Select Committee's recommendations will be incorporated into the revised I-T Bill. According to sources, the new Income Tax Bill will be presented for House consideration on Monday "to avoid confusion by multiple versions of the Bill and to provide a clear and updated version with all changes incorporated." The Select Committee, chaired by Baijayant Panda, had suggested a host of changes in the Income Tax Bill, which was introduced in the Lok Sabha on February 13.
Soon after its introduction in the Lower House, the Bill, which will replace the six-decade-old Income Tax Act, 1961, was referred to the Select Committee for scrutiny.
The bill had received some suggestions from the 31 members of the Select Committee. In addition, they proposed that taxpayers be able to claim a TDS refund even after the ITR filing deadline without incurring any penalties, and that the tax exemption on anonymous donations to religious and charitable trusts be maintained in the new law. The government has excluded non-profit organizations (NPOs) from the tax on anonymous donations made by purely religious trusts in the new bill. However, in accordance with the Bill, such donations that are received by a religious trust that may also perform other charitable functions, such as running educational institutions and hospitals, will be taxed in accordance with the law.
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