The Central Board of Direct Taxes (CBDT) is expanding its Nudge 2.0 campaign, aimed at enhancing foreign asset disclosure to combat tax evasion. The initiative employs a non-intrusive use of data to guide taxpayers, with plans to include lower-value accounts and implement pre-filling alerts on its electronic portal.
According to an internal report obtained by businessline, Bengaluru has emerged as the leading city among 18 major urban areas in India for filing revised or belated income tax returns (ITRs) that declare foreign assets (FAs) and foreign sources of income (FSIs) for the financial year 2025-26. The campaign has resulted in the declaration of approximately ₹1 lakh crore in foreign assets and over ₹6,500 crore in total foreign income through more than 1.57 lakh revised and belated ITRs, leading to tax collections exceeding ₹800 crore.
As part of Nudge 2.0, targeted SMS and email communications were sent during November and December of the previous year to high-risk taxpayers identified as potentially having unreported foreign assets. These individuals were encouraged to review their filings and submit revisions by December 31, 2025, to avoid potential penalties.
In light of the successes from the first two Nudge campaigns, the CBDT is outlining future strategies. It plans to broaden its focus to encompass lower-value accounts reported under the Common Reporting Standard (CRS) and the Foreign Account Tax Compliance Act (FATCA). This approach recognizes that non-compliance in these cases generally indicates behavioral issues rather than merely concerns about tax amounts.
The CRS, established by the Organisation for Economic Co-operation and Development (OECD), facilitates automatic exchange of financial account information among nations to mitigate offshore tax evasion. India has a similar information-sharing agreement with the United States under FATCA.
Additionally, the CBDT is advocating for a continuous nudging model that emphasizes periodic, data-driven campaigns, standardized reporting schedules, and enhanced predictive risk analysis. Plans also include pre-filling alerts on the e-portal and the automatic completion of related fields in the ITRs, alongside improved global coordination and increased engagement with employers and professionals.
It is notable that a significant portion of asset declarations is made by professionals, while wealthier individuals and politicians continue to conceal black money. Within the targeted groups, major cities like Bengaluru, Hyderabad, Chennai, Delhi, and Mumbai accounted for a considerable share of revised returns and asset disclosures, reflecting the presence of internationally mobile professionals and high-net-worth individuals.
Over the past two years, more than 1.11 crore revised and updated returns have been filed through the Saksham Nudge campaigns, generating tax revenues of ₹8,800 crore. Additionally, the success of the Saksham Nudge program has led to the introduction of a foreign asset disclosure scheme for smaller taxpayers, as announced in the 2026 Budget by Finance Minister Nirmala Sitharaman.
Published on May 10, 2026.
