Income-Tax authorities aim to gain increased control through recommendations from a parliamentary panel.
Published on July 16, 2025
The Select Committee on the Income Tax Bill 2025 has proposed around 285 key changes, aiming to modernise and simplify India’s tax laws. The report, which will be presented to the Lok Sabha on July 21, 2025, focuses on refining language, removing contradictions, and reintroducing beneficial provisions.
One of the significant changes proposed by the committee is the simplification of the powers of the Income-Tax authorities. The report suggests the removal of provisions that have been deemed burdensome or contradictory, such as the denial of refunds if tax returns are filed after the due date. This change would improve administrative powers related to refunds, making taxpayer facilitation more straightforward.
However, specific details on the changes related to the redefinition of Associated Enterprises and the definition of 'Accountant' were not explicitly stated in the available sources. It is possible that these details may be included in the full report, which has not been disclosed yet.
The committee's suggestions also include procedural streamlining and anti-avoidance provisions. The new Bill spans everything from digital documentation to dispute resolution, international taxation to non-profit oversight, aiming to consolidate and simplify India's fragmented and often arcane Income-Tax laws.
The objective of the new Bill is to do away with the Income-tax Act of 1961, replacing it with a codified structure. The committee has further refined the definition of Associated Enterprises, which now includes an enterprise that participates in the management or control or capital of another enterprise, either directly or indirectly.
Despite concerns expressed by professional bodies representing cost accountants and company secretaries over their exclusion from the definition of accountant in the Income-Tax Bill 2025, the committee has not favoured any change in the definition of 'accountant.' Cost Accountants will continue to be excluded from the definition.
The Institute of Company Secretaries of India (ICSI) opposed this contention, arguing that the inclusion of company secretaries in the definition of accountant would ensure better governance and transparency in the tax system.
The government can choose to accept or reject the changes, and after Cabinet approval, the amended Bill will be moved in Parliament during the Monsoon Session starting on July 21. The final report will guide further government and Cabinet approvals before the bill’s passage.
Sources: 1. The Hindu 2. The Economic Times 3. Business Standard
- The government may need to consider the implications of the committee's decision not to change the definition of 'accountant' in the Income-Tax Bill 2025, as it might affect the governance and transparency in the tax system, as argued by the Institute of Company Secretaries of India (ICSI).
- The new Income-Tax Bill, aimed at modernising and simplifying India’s tax laws, includes procedural streamlining, anti-avoidance provisions, and a revised definition of Associated Enterprises, among other changes.
- The committee's proposal to remove burdensome provisions related to refunds, such as the denial of refunds if tax returns are filed after the due date, could have a significant impact on the finance aspect of businesses, potentially making tax administration more efficient.
