Sitharaman tables new Income Tax bill in Lok Sabha; Crypto defined under income

Union Finance Minister Nirmala Sitharaman on Thursday tabled the New Income Tax Bill 2025 in Lok Sabha which aims to simplify tax laws modernise definitions and provide more clarity on various taxrelated matters ANI reportedAs per ANI the governments new bill seeks to replace the existing 1961 Income Tax Act and introduce changes that affect different categories of taxpayers including individuals businesses and nonprofit organisationsAfter presenting the income tax bill the Finance Minister asked the Lok Sabha Speaker Om Birla to nominate members for a standing committee to review the newly tabled income tax billNotably the new bill introduces simplified language and modern terminology by replacing outdated terms and bringing in new ones to align with todays economy ANI citedAccording to ANI it introduces the term tax year instead of the existing terms like financial year and assessment year systems It also defines virtual digital asset and electronic mode reflecting the growing importance of digital transactions and cryptocurrency in todays financial landscapeIn terms of scope of total income the new bill maintains the existing tax principles while making certain clarifications Under the previous law Sections 5 and 9 of the Income Tax Act 1961 it stated that the Indian residents were taxed on their global income while nonresidents were taxed only on the income they earned in IndiaThe new bill in Clauses 5 and 9 keeps this rule but provides a more clear definition of deemed income such as payments made to specific individuals making tax rules more transparent for nonresidents ANI reportedMoreover the bill brings changes to deductions and exemptions Earlier Sections 10 and 80C to 80U of the Income Tax Act 1961 allowed deductions for investments donations and specific expensesThe new bill under Clauses 11 to 154 consolidates these deductions and introduces new provisions to support startups digital businesses and renewable energy investments ANI reportedAs per ANI changes have also been made to the term capital gains tax Under the previous law Sections 45 to 55A categorised capital gains into shortterm and longterm based on holding periods with special tax rates for securitiesThe new bill in Clauses 67 to 91 keeps the same categorisation but introduces explicit provisions for virtual digital assets while updating beneficial tax rates This ensures that digital assets such as cryptocurrency are covered under a proper tax frameworkIn the previous law under Sections 11 to 13 nonprofit organisations were provided income tax exemptions for certain charitable purposes but had limited compliance guidelines ANI reportedThe new bill in Clauses 332 to 355 establishes a more detailed framework by clearly defining taxable income compliance rules and restrictions on commercial activities This not only introduces a stricter compliance regime but also provides welldefined exemptionsOverall the Income Tax Bill 2025 aims to simplify tax laws encourage digital and startup investments and bring greater clarity in taxation policies for businesses and nonprofits ANI reportedThe government believes that these changes will make tax compliance easier while ensuring a fair tax structure for all categories of taxpayersWith ANI inputs