The Centre has introduced the 2025 New Income Tax Bill in an effort to streamline and simplify the current tax regulations. The new I-T Bill 2025 stated that the existing Income Tax Act of 1961 has undergone multiple amendments, resulting in a burdened and complex language that has escalated compliance costs for taxpayers and hindered direct tax administration. The latest bill aims to rectify these inefficiencies.
The new bill has preserved the tax policies and key provisions of the Income-Tax Act, 1961. Redundant rules have been removed, and the remaining text of the tax law has been simplified for easier comprehension.
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The recent Income Tax Bill has granted significant powers to the Central Board of Direct Taxes (CBDT).
For example, the income tax assessing officer can request credit card and bank account information from taxpayers to verify their details, as outlined in the Income-Tax Bill 2025.
Additionally, under section 263 (2)(a) and (2)(b) of the bill introduced in parliament, the CBDT now has the authority to establish rules for ITR forms, their verification process, and other relevant details.
CBDT has stated that the simplification of tax laws in the new bill will improve clarity and facilitate compliance.
The CBDT has the authority to establish guidelines regarding:
The specific individuals or groups required to submit their Income Tax Returns (ITRs) electronically or through other means; The format and method of submitting the return, whether electronically or through other means; The necessary documents, statements, receipts, certificates, audited reports, or any other paperwork that may not be submitted electronically with the return but must be provided to the assessing officer upon request; The computer resource or electronic record to which the electronically submitted return may be transmitted.
Details that may be requested by the assessing officer include:
Income that is exempt from tax Assets of a specified nature and value held by the taxpayer as a beneficial owner, beneficiary, or otherwise Information regarding bank accounts and credit cards held by the taxpayer Expenditure exceeding the prescribed limit incurred by the taxpayer under specific categories