CBDT Chairman Ravi Agrawal Unveils Vision for Simplified Income Tax Act 2025

• CBDT Chairman Ravi Agrawal details the upcoming Income Tax Act 2025, effective April 1, 2026, focusing on simplification, decriminalisation of minor defaults, and refined processes.
• The new Act aims to reduce litigation by offering multiple opportunities for taxpayers to accept additions/income without penalty, paying only additional tax, and consolidating assessment and penalty procedures.
• Draft rules and forms for the Income Tax Act 2025 will be released in February for stakeholder consultation, as hinted by Finance Minister Nirmala Sitharaman.
• A special window under the Black Money Act is introduced for small taxpayers with genuinely omitted foreign income/assets (up to ₹1 crore income, ₹5 crore assets) to regularise their records.
• The NUDGE campaign has yielded significant results, with 1.11 crore updated/revised returns filed, generating ₹8,800 crores in additional revenue and ₹6,500 crores in reported foreign income.

Why It Matters: The Income Tax Act 2025 aims for a simpler, less litigious, and more taxpayer-friendly fiscal landscape.