Skip to main Communities My dashboard Log in Sign up RS PUBLICATION Published April 15, 2026 | Version v1 Journal article Open IMPACT OF THE INCOME TAX ACT 2025 ON THE BANKING SECTOR IN INDIA- A CONCEPTUAL STUDY Authors/Creators Dr. Muniyappa N (Researcher) 1 Show affiliations 1.
Associate Professor of Commerce Government First Grade College Channapatna, (Affiliated with Bangalore University)- 562160. Karnataka Description Abstract : The enactment of the Income Tax Act 2025 (ITA 2025) marks a watershed moment in India's direct taxation landscape, replacing the six-decade-old Income Tax Act of 1961. For the banking sector — a pivotal pillar of the Indian economy — this legislative overhaul carries profound implications spanning tax provisioning, deferred tax accounting, compliance infrastructure, and strategic financial planning. This conceptual paper aims to systematically analyse the multidimensional impact of the ITA 2025 on scheduled commercial banks, non-banking financial companies (NBFCs), cooperative banks, and foreign bank branches operating in India. Drawing on doctrinal legal analysis, comparative statutory review, and established frameworks from financial accounting theory, the study develops a conceptual model that maps the transmission channels through which the new tax regime affects banking sector behaviour, profitability, and regulatory compliance. The paper identifies key provisions of the ITA 2025 — including revised bad debt deduction norms, rationalized tax treatment of provisions for non-performing assets (NPAs), remodeled withholding tax obligations, and updated thin-capitalization rules — and examines their likely consequences for banks' effective tax rates, deferred tax positions, and capital adequacy ratios. The study argues that while the new Act simplifies compliance to a degree, it simultaneously introduces transitional challenges and reinterpretation risks that require strategic adaptation by banking institutions and their tax functions. Keywords: Income Tax Act 2025, Banking Sector, NPA Provisioning, Deferred Tax, NBFC, Tax Compliance, Direct Tax Reform. Files 24.pdf Files (301.1 kB) Name Size Download all 24.pdf md5:6fcc2f884bb178f4921b7a9ec68a3cac 301.1 kB Preview Download 42 Views 19 Downloads Show more details All versions This version Views Total views 42 42 Downloads Total downloads 19 19 Data volume Total data volume 7.2 MB 7.2 MB More info on how stats are collected.... Versions External resources Indexed in OpenAIRE Communities Keywords and subjects Keywords Income Tax Act 2025, Banking Sector, NPA Provisioning, Deferred Tax, NBFC, Tax Compliance, Direct Tax Reform. Details DOI DOI Badge DOI 10.5281/zenodo.19598068 Markdown [](https://doi.org/10.5281/zenodo.19598068) reStructuredText .. image:: https://zenodo.org/badge/DOI/10.5281/zenodo.19598068.svg :target: https://doi.org/10.5281/zenodo.19598068 HTML <a href="https://doi.org/10.5281/zenodo.19598068"><img src="https://zenodo.org/badge/DOI/10.5281/zenodo.19598068.svg" alt="DOI"></a> Image URL https://zenodo.org/badge/DOI/10.5281/zenodo.19598068.svg Target URL https://doi.org/10.5281/zenodo.19598068 Resource type Journal article Publisher RS Publication Published in International Journal of Research in Management, 16(2), ISSN: 2249-5908, 2026. Rights License Creative Commons Attribution 4.0 International The Creative Commons Attribution license allows re-distribution and re-use of a licensed work on the condition that the creator is appropriately credited. Read more Copyright RS Publication Citation Export Technical metadata Created April 17, 2026 Modified April 17, 2026 Jump up About About Policies Infrastructure Principles Projects Roadmap Contact Blog Blog Support Help FAQ Developers REST API OAI-PMH Contribute GitHub Donate Funded by Powered by CERN Data Centre & InvenioRDM Status Privacy policy Cookie policy Terms of Use This site uses cookies. Find out more on how we use cookies Accept all cookies Accept only essential cookies