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The central government will soon bring a new Income Tax Act in place of the old Income Tax Act in the country. The scope of the new Income Tax Act is to facilitate it. The Finance Ministry is considering the possibility of announcing it in the next budget in February-2025. The Finance Minister is moving to remove unnecessary clauses and sub-clauses from the Income Tax Act. However, the Finance Ministry is currently engaged in amending the Income Tax Act, after which a new amended law will come out in the country. If the new system comes, it will be a big change for the taxpayers. The Finance Ministry may remove unnecessary sections to simplify the process of taxation.
Income tax implemented for the first time in the country?
It is worth noting that the income tax system in the country was implemented in the year 1860 by Sir James Wilson, who was the Finance Minister of India before independence. This system was implemented to compensate for the loss suffered by the government due to the military coup of 1857.
Income Tax Act-1961 came into force in the year-1962
It is worth noting that the Income Tax Act-1961 was implemented on 1 April 1962 and till now it is applicable all over the country. The new tax system was implemented in the year 2020. For the assessment year-2024-25, 72 percent of the taxpayers for the financial year 2023-24 filed their returns under this new tax system.
this work will be done next month
The work of reviewing and finalizing the new Income Tax Act will be completed in the coming months. The amendment aims to make the tax code more comprehensive. It aims to reduce the burden for taxpayers and improve clarity. Under this change, new tables of expenditure, investment, holding, property will be introduced. Verification process for the source of income can also be introduced.
The tax system will be made as simple as possible. Prime Minister Narendra Modi wants more and more people to come under the tax net and this is why the government has come up with a new tax system.
Responses sought under the new system
The Finance Ministry is reviewing the new tax system and consulting experts. It is also known that there has been an overwhelming response to simplify the tax filing process. Almost all responses call for simplifying tax filing and reducing the compliance burden.