Amid continued opposition protest, the Lok Sabha on Monday passed two important legislations pertaining to taxation -- Income-Tax (No 2) Bill and Taxation Laws (Amendment) Bill.
The Income-Tax (No.2) Bill, 2025 seeks to consolidate and amend the law relating to Income Tax Act 1961. The Bill will replace the Income Tax Act, 1961.
The Bill incorporates almost all of the recommendations of the Select Committee headed by senior BJP member Baijayant Panda.
The other legislation -- the Taxation Laws (Amendment) Bill, 2025 will amend the Income-tax Act, 1961 as well as the Finance Act, 2025. It aims to provide tax exemptions to subscribers of the Unified Pension Scheme.
These Bills were introduced by Finance Minister Nirmala Sitharaman in the lower house earlier in the day.
"Almost all of the recommendations of the Select Committee have been accepted by the government. In addition, suggestions have been received from stakeholders about changes that would convey the proposed legal meaning more accurately," said the statement of objects and reasons of the Income-Tax (No.2) Bill, 2025.
The Select Committee had suggested a host of changes in the Income-tax Bill, 2025, which was introduced in the Lok Sabha on February 13.
"There are corrections in the nature of drafting, alignment of phrases, consequential changes and cross-referencing. Therefore, a decision has been taken by the government to withdraw the Income-tax Bill, 2025 as reported by the Select Committee. Consequently, Income-tax (No. 2) Bill, 2025 has been prepared to replace the Income-tax Act, 1961," the statement said.
The Taxation Laws (Amendment) Bill, 2025, also passed by voice in the Lok Sabha, incorporated changes in the scheme of block assessment with regard to Income Tax search cases, and would provide for certain direct tax benefits to public investment funds of Saudi Arabia. It seeks to amend the Income-tax Act, 1961 and also the Finance Act, 2025.
The government in July announced that all tax benefits available under the New Pension Scheme (NPS) shall apply to the Unified Pension Scheme (UPS), which was implemented from April 1, 2025.
These Bills were passed without any debate amid vociferous protest by members of Opposition over revision of electoral rolls in Bihar.
After the passage of these bills by voice vote, the Lok Sabha was adjourned for the day.
