Ministry of Finance addresses recent report on Swiss Bank Deposit

New Delhi [India], June 20 : The Ministry of Finance on Friday addressed recent media reports concerning an increase in money deposited by Indian entities in Swiss bank accounts, providing an update on India's ongoing efforts to combat offshore tax evasion through international exchange of information.

"In this context, it is stated that in order to combat the problem of offshore tax evasion, tax jurisdictions cooperate among themselves and share relevant information about financial assets held by the citizens of other countries in their tax jurisdiction," the ministry of Finance said.

The ministry further added that, under the Automatic Exchange of Information (AEOI) framework, with Switzerland providing annual financial information to Indian authorities since 2018. The first data transmission occurred in September 2019 and has continued regularly, encompassing even accounts suspected of financial irregularities.

The Central Board of Direct Taxes (CBDT) regularly undertakes a systematic review of data so received and identifies taxpayers, whose cases require further verification. Furthermore, such verification is carried out through different modes, including search and survey actions, open enquiries, etc.

For the Assessment Year (AY) 2024-25, the CBDT compared AEOI data with information about foreign assets and income reported by taxpayers in their Income Tax Returns (ITRs), covering all jurisdictions, including Switzerland. Furthermore, SMS and emails were dispatched to taxpayers who had not reported foreign assets and income in the appropriate ITR schedules, urging them to review their filings.

A total of 24,678 taxpayers reviewed their ITRs, and 5,483 taxpayers subsequently filed belated returns for AY 2024-25. These belated returns collectively reported foreign assets valued at Rs. 29,208 crores and additional foreign income of Rs. 1,089.88 crores. The Ministry stated that suitable action under existing law is being considered for non-responsive taxpayers.

The initiative has led to a substantial increase in taxpayers reporting foreign assets and income. For AY 2024-25, a total of 2.31 lakh taxpayers reported their foreign assets and income, marking a growth of 45.17 per cent compared to 1.59 lakh taxpayers in AY 2023-24.

The Ministry attributed this positive trend to various awareness initiatives and a system-driven approach, which are encouraging taxpayers to voluntarily declare their foreign assets and income and revise their ITRs to ensure accurate reporting. The government reiterated its commitment to taking enforcement and statutory actions as per extant law in cases of continued non-compliance.

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