Over 60,000 Citizen Inputs Shaping India’s New Income Tax Bill, 2025: Key Reforms Ahead

The Indian government has received over 60,000 inputs from citizens as part of the process to draft the new Income Tax Bill, 2025. Union Finance Minister Nirmala Sitharaman revealed this information during a post-Budget event in Mumbai on Monday, highlighting the importance of public participation in shaping the new tax reforms.

Citizen Inputs Shape New Income Tax Bill, 2025

Speaking at the event, Finance Minister Nirmala Sitharaman emphasized the significance of Prime Minister Narendra Modi’s principle of ‘Jan Bhagidari’ (People’s Participation) in the review of the Income-Tax Act of 1961. She noted that the inputs from over 60,000 citizens are a crucial part of the government’s efforts to reform and simplify the country’s tax system.

The new Income Tax Bill, introduced in the Lok Sabha last week, aims to streamline tax provisions, making them easier to understand and reducing the scope for legal disputes. The government’s goal is to ensure that the new tax provisions are accessible and fair for taxpayers.

Focus on Public Expenditure and Tax Relief

The Finance Minister also addressed concerns about the shifting focus of government expenditure. Sitharaman clarified that the government’s emphasis, post-Covid-19 pandemic, continues to be on public capital building. She stressed that while the perception of a shift from expenditure to consumption is incorrect, the government has increased capital expenditure (Capex) and provided tax relief for individuals earning up to Rs. 12 lakh per annum.

Fiscal Deficit and Economic Reforms

Sitharaman reaffirmed the government’s commitment to the fiscal deficit path, set in the July Budget, aiming for a deficit below 4.5% of the GDP. She also highlighted ongoing reforms aimed at boosting manufacturing, improving the Ease of Doing Business, and advancing social infrastructure.

“We won’t stop with it. The momentum of reforms shall continue, and we are opening up newer areas for investment, such as the space and nuclear sectors,” the Finance Minister said.

Capital Expenditure and Fiscal Deficit Estimates

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The Budget for 2025-26 has maintained sectoral allocations and estimated an effective capital expenditure of Rs. 19.08 lakh crore. This capital expenditure represents 4.3% of India’s GDP, with the fiscal deficit set at 4.4% of GDP. Sitharaman also expressed hope that state governments would take further steps to promote Ease of Doing Business in their respective regions.

The introduction of the new Income Tax Bill, 2025, marks a significant step in simplifying India’s tax framework and promoting greater citizen involvement in policy-making. With over 60,000 citizen inputs, the government is moving forward with a reform-oriented agenda that promises to boost economic growth and improve tax compliance.