Government To Introduce New Income Tax Bill; FDI in Insurance Raised To 100%

Government to Introduce New Income Tax Bill; FDI in Insurance Raised to 100%

Finance Minister Nirmala Sitharaman announced on Saturday that the government will introduce a new Income Tax Bill next week, aiming to advance the "trust first, scrutinise later" approach. The bill is expected to simplify existing tax laws, making them clearer and more concise.

Presenting the Budget for 2025-26, Sitharaman highlighted the government's decade-long efforts to ease taxpayer compliance, including faceless assessments, the introduction of a taxpayers' charter, and faster processing of tax returns. She noted that nearly 99% of income tax returns are now based on self-assessment. In a significant reform move, the minister also announced that Foreign Direct Investment (FDI) in the insurance sector will be increased from 74% to 100%, aiming to attract more global investments and strengthen the sector.

To support the review of the Income Tax Act, 1961, the Central Board of Direct Taxes (CBDT) has established an internal committee, along with 22 specialised sub-committees, to streamline tax laws, reduce disputes, and enhance tax certainty.

Additionally, the government will upgrade air cargo warehousing for high-value perishable horticulture goods and expand India Post Payments Bank services in rural areas to enhance financial inclusion.