Nudge Campaign Leads to Significant Increase in Taxpayer Disclosures: Finance Minister
In a recent statement, Finance Minister Nirmala Sitharaman announced that over 30,000 taxpayers have revised their income tax returns (ITRs) or filed belated returns, subsequently declaring additional foreign assets and income totaling approximately ₹30,300 crore. This initiative was part of a ‘nudge’ campaign aimed at encouraging taxpayers to voluntarily disclose their foreign income and assets.
During her address in the Lok Sabha regarding the Finance Bill 2025, Sitharaman explained that targeted communication was employed to prompt these disclosures. SMS and E-mails were sent to around 19,501 select taxpayers, urging them to review their Income Tax Returns filed for the 2024-25 assessment year, based on information available to the Income Tax department concerning foreign deposits,” she remarked.
The outcomes of the campaign were noteworthy. Out of the targeted group of 19,501 taxpayers, a significant 11,162 chose to revise their returns and complete the Schedule Foreign Assets Form. Collectively, these taxpayers reported total foreign assets valued at ₹11,259.29 crore and disclosed foreign income amounting to ₹154.42 crore.
Moreover, Sitharaman highlighted that 883 taxpayers amended their ITRs, correcting their residency status from resident to non-resident in the revised return for the 2024-25 assessment year. She noted that this outreach had a consequential ‘ripple effect’ on tax compliance.
As a result of the campaign, an additional 13,516 taxpayers reported foreign assets worth ₹7,564 crore and foreign income close to ₹353 crore in their revised ITRs for the same assessment year. Cumulatively, the nudge campaign resulted in total disclosures of foreign assets amounting to ₹29,208 crore and foreign income of ₹1,089 crore (approximately ₹30,297 crore) in Schedule FA (foreign assets) by a total of 30,161 taxpayers.
Sitharaman concluded that the nudge campaign regarding properties and assets held abroad has proven successful. Tax assessees have not only disclosed their foreign properties but have also settled the corresponding tax liabilities.