The BRICS TimesFinance Minister Nirmala Sitharaman reveals a major tax overhaul starting April 1, 2026.
Big Changes in Tax Rules
Finance Minister Nirmala Sitharaman made a huge announcement while presenting Budget 2026. The new Income Tax Act will start on April 1, 2026. This law allows taxpayers to pay taxes instead of facing penalties. It proposes relief for reporting errors and data center companies.
Easier Forms and Lower Penalties
Courts may now convert jail sentences into simple fines under this act. The government will simplify all income tax forms for better use. Taxpayers might get an extra 10% relief beyond current rates. CBDT Chief Ravi Agarwal previously mentioned these simplified rules in November.
What is the New Income Tax Act?
The new law takes effect from the next financial year starting April. It aims to make tax compliance much easier for every citizen. This act replaces the 64-year-old Income Tax Act of 1961. It focuses on clarity rather than introducing any new tax rates.
Simplifying the Law
The act removes old language and many unnecessary legal provisions. It cuts down the sections from 819 to just 536. The total word count drops from 5.12 lakh to 2.6 lakh words. It introduces 39 tables and 40 formulas for better understanding.
