Overview

• Parliament approved the Income Tax Bill, 2025, replacing the 1961 Act, but officials have yet to confirm whether its technical amendments will take effect in FY2025-26 or FY2026-27 as implementation rules are drafted.
• Sovereign wealth and pension funds investing in infrastructure between April 1, 2020, and March 31, 2030, will be exempt from tax on dividends, interest and long-term capital gains.
• The law suspends regular assessments for block periods in search cases until a block assessment order is issued to reduce overlapping tax demands.
• A drafting error in the new regime has been corrected to restore the ₹75,000 standard deduction for salaried individuals.
• Unified Pension Scheme holders will now enjoy the same tax-free lump sum and partial withdrawal rules as National Pension System account holders.