New Income Tax Act written in simple language to reduce legal complexities: CBDT

New Delhi [India], August 25 (ANI): The new Income Tax Act has been formulated using simple language to eliminate complicated legal challenges and make tax provisions more accessible to common taxpayers, according to RN Parbat, Member (Legislation) at the Central Board of Direct Taxes (CBDT).
In an interview with ANI, Parbat explained that the apex income tax body has moved away from archaic terminology and complex explanations that previously made tax laws difficult for ordinary citizens to comprehend.
"The common assessee, if he reads the provisions, he is able to understand what the law says in his case," Parbat said. "The common person will be able to know his rights. He will be able to understand the law under which he is paying income tax."
The CBDT has adopted tabular formats and contemporary language to replace outdated legal terminology.
Parbat emphasised that this approach will provide greater certainty to taxpayers and reduce the likelihood of future legal disputes.
"The language is simple. We have used tabular forms. We have done away with archaic words and written in a more simpler language. This is definitely going to provide more certainty to assessees," he stated.
CBDT member Parbat also lauded Prime Minister Narendra Modi and Finance Minister Nirmala Sitharaman for their leadership.
A dedicated committee was constituted on February 13, the same day the Bill was introduced in Parliament, to work on simplification and formulation of new rules and forms.
The committee completed substantial work and conducted public consultations, receiving thousands of suggestions from citizens. The committee had suggested a few changes, which were understandably accommodated in the new legislation.
"The committee has been working day and night," Parbat noted. "All these new rules and forms are being sent to the TPL division in the CBDT where they will be examined and re-examined."
According to CBDT, all new rules and forms would be ready for rollout by the end of this year, ahead of the Act's implementation on February 26, 2026.
Addressing concerns about enforcement powers, Parbat clarified that the new Act explicitly mentions powers that were already available to income tax authorities, particularly regarding digital assets and online evidence collection.
"Evidences are available online. They are kept in clouds, and undisclosed income is being invested in virtual digital assets. We need to have access to all of this," he explained.
The CBDT will introduce new Standard Operating Procedures (SOPs) for handling digital assets, with these powers being invoked only during search, seizure, and survey operations, which remain limited in number each financial year.
Regarding pending tax litigation cases, Parbat assured that the CBDT is making full-fledged efforts to dispose of cases as quickly as possible through administrative preparedness.
The Government had proposed in the budget in July 2024 that a time-bound comprehensive review of the Income-tax Act, 1961 would be undertaken to make the Act concise, lucid, and easy to read and understand.
The Government had introduced the Income Tax Bill, 2025, in the Lok Sabha on February 13, 2025, and it was soon referred to the Select Committee for examination.
The Select Committee laid its report in the Lok Sabha on July 21, 2025, with suggestions. The BJP MP Baijayant Panda-headed 31-member Select Committee had suggested a few changes to the legislation.
The previous Bill was withdrawn, only to be reintroduced and passed in the Parliament, with a few changes. (ANI)