Lok Sabha: Taxation and Other Laws Amendment Bill 2026 Passes

• The Lok Sabha has passed the Taxation and Other Laws (Amendment) Bill, 2026.
• The bill proposes amendments to several key laws, including the Income-tax Act, 2025, and the Payment and Settlement Systems Act, 2007.
• The passage of this bill marks a significant step towards implementing wide-ranging reforms in the country's tax laws and regulations.

The passage of this bill marks a significant step towards implementing wide-ranging reforms in the country's tax laws and regulations.

The Lok Sabha has passed the Taxation and Other Laws (Amendment) Bill, 2026, which seeks to replace the Income-tax (Amendment) Ordinance, 2026. The bill proposes amendments to several key laws, including the Income-tax Act, 2025, the Finance Act, 2026, and the Payment and Settlement Systems Act, 2007. These changes aim to address various issues in the taxation and digital payments landscape.

The passage of this bill marks a significant step towards implementing wide-ranging reforms in the country's tax laws and regulations. The Lok Sabha has now sent the bill to the Rajya Sabha for its approval.

The Income-tax (Amendment) Ordinance, 2026, which is being replaced by the Taxation and Other Laws (Amendment) Bill, 2026, was issued in June 2026 to address certain pressing issues in the taxation regime. The ordinance made several key changes to the Income-tax Act, 2025, including provisions related to digital payments and tax compliance. However, the ordinance had a limited shelf life and was meant to be replaced by a more comprehensive legislation.

The Payment and Settlement Systems Act, 2007, is another crucial law that is being amended through this bill. The act regulates payment systems in India and provides for the establishment of a payment regulator. The proposed amendments aim to bring about greater clarity and consistency in the regulation of digital payments.

The passage of the Taxation and Other Laws (Amendment) Bill, 2026, has significant implications for various stakeholders, including taxpayers, businesses, and financial institutions. The bill's provisions related to digital payments are expected to have a major impact on the country's payment ecosystem.

Lawyers advising clients on tax compliance and regulatory requirements should closely examine the changes brought about by this legislation. The amendments to the Income-tax Act, 2025, and the Payment and Settlement Systems Act, 2007, will require businesses to adapt their operations and ensure that they are in compliance with the new regulations.

Lawyers should watch for the implications of these reforms on their clients' digital payment systems and manufacturing operations, particularly with regards to tax compliance and regulatory requirements.

Source: Original reporting via SCC Times