New Income Tax Bill 2025: Crypto Considered Under Income From Other Sources

On Thursday, February 13, 2025, Finance Minister Nirmala Sitharaman presented the new Income Tax Bill, 2025, in the Lok Sabha as part of efforts to reform the tax system. The new Income Tax Bill aims to simplify and streamline provisions to enhance clarity and reduce the potential for legal disputes.

This new legislation will replace the Income Tax Act of 1961, which has seen numerous amendments over the past six decades. Before final approval, the bill will be reviewed by the Select Committee of Parliament. The new law is expected to come into effect on April 1, 2026.

Objective of New Income Tax Bill

The primary goal of the new Income Tax Bill is to make tax laws more transparent, easier to understand, and more taxpayer-friendly. By replacing complex provisions with simpler language, it seeks to reduce legal conflicts and promote voluntary compliance.

The bill may also introduce reduced penalties for certain offences, aiming to create a more accommodating tax environment.

Crypto and Other Virtual Assets Under Other Sources

At 622 pages and containing 536 clauses, the new bill is much shorter than the existing 64-year-old law, which spans 823 pages and contains 819 sections. The bill simplifies legal terminology, replacing terms like “assessment year” with “tax year,” and eliminates convoluted provisions to improve readability and reduce ambiguities. It also removes outdated clauses as part of the simplification effort.

Additionally, the new bill includes specific provisions for virtual digital assets and updates tax rates, ensuring that digital assets like cryptocurrency are properly taxed.

While the bill does not change current tax slabs or rebate structures, it focuses on making the tax code more user-friendly.

Also Read: New Income Tax Bill: Check How Is It Different From the Old Income Tax Law

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