India, Feb. 1 -- The Union Budget 2026-27 has introduced a significant legislative shift with the announcement of the Income Tax Act, 2025, which will replace the six-decade-old Income Tax Act of 1961. This new legislation will take effect from 1 April 2026.

Finance Minister Nirmala Sitharaman, in her ninth consecutive budget presentation confirmed that the government completed the drafting of the new tax code in record time. The primary goal of the new Act is to reduce the complexity of the existing tax framework, making it easier for citizens to understand and comply.

The new Act focuses on clarity and brevity. It reduces the total number of sections from over 800 to approximately 536 sections. By cutting down the word count by nearly...