Government to Simplify Income Tax Act in Comprehensive Review

The government announced a review of the Income Tax Act to simplify its language. Finance Minister Nirmala Sitharaman, in the Union Budget 2024-25 presentation, mentioned plans to merge tax exemption regimes for charitable trusts and streamline TDS defaults. DPI apps for multiple sectors will also be developed.

On Tuesday, the government revealed plans for a full review of the Income Tax Act to streamline its language and make it more comprehensible.

During the Union Budget 2024-25 presentation, Finance Minister Nirmala Sitharaman announced that the government will introduce a standard operating procedure (SoP) for TDS defaults and simplify the compounding of such offences. Additionally, two tax exemption regimes for charitable trusts will be unified.

Sitharaman highlighted that 58 per cent of corporate tax came from the simplified tax regime in FY23, with over two-thirds of individuals opting for the new income tax regime. She also announced the development of DPI apps for credit, e-commerce, education, health, law, MSME service delivery, and urban governance.