New Delhi: Even as opposition MPs were detained while marching towards the Election Commission of India on Monday (August 11), the Lok Sabha passed the new Income Tax Bill, 2025, and the Taxation Laws (Amendment) Bill, 2025, through a voice vote. 

Curiously, Union finance minister Nirmala Sitharaman moved these legislations amid protests by the opposition members as Money Bills, which means the Rajya Sabha does not need to consider these bills for their passage.

As a result, both the bills were passed without any debate on them, following which the Lok Sabha was adjourned for the day. 

Notably, on August 8, the government officially withdrew the earlier Income Tax Bill, 2025, passed in February, and reintroduced it as The Income Tax (No.2) Bill, 2025, on Monday after making certain modifications.

The No.2 bill amends the Income Tax Act, 1961, and incorporates all recommendations of the Select Committee, chaired by BJP’s Kendrapara MP Baijayant Panda. 

“Almost all of the recommendations of the Select Committee have been accepted by the government. In addition, suggestions have been received from stakeholders about changes that would convey the proposed legal meaning more accurately,” read the statement of objects and reasons of the Income-Tax (No. 2) Bill, 2025.

The Income Tax Bill, 2025, was first introduced in the Lok Sabha on February 13, 2025, as the government said that the older version of the 1961 Act needed corrections in “the nature of drafting, alignment of phrases, consequential changes, and cross-referencing.”

The government claimed that the new Income Tax Act aims to revise structure, simplify TDS, improve provisions of digital taxation and resolution of disputes and expand tax collection through a range of data-driven and technological measures. The law, the government claimed, will also enable individuals to seek refunds without penalties for late submissions. 

Similarly, the new Taxation Laws Bill also amends the Income Tax Act, 1961, and the Finance Act, 2025, that will allow tax exemptions announced by Sitharaman during the annual budget to subscribers of the Unified Pension Scheme (UPS).

The Union government had announced UPS after a large section of tax-paying government employees protested against the discontinuation of the Old Pension Scheme and the New Pension Scheme (NPS). The new law allows UPS subscribers to avail of the tax benefits that they received as NPS subscribers.  

The Taxation Laws (Amendment) Bill, 2025, also provides direct tax benefits to Saudi Arabia’s public investment funds and makes changes to cases of block assessment schemes in Income Tax. 

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