Lok Sabha Question No. 3622 (UNSTARRED), answered on 2025-08-11
Subject: Income Tax Returns via AI Tools
Ministry: FINANCE
Asked by: Shri V K Sreekandan

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE

## LOK SABHA UNSTARRED QUESTION NO. 3622

## ANSWERED ON MONDAY, 11 th  AUGUST,2025/SRAVANA 20,1947 (SAKA)

## 'Income Tax Returns Via AI Tools'

## 3622. Shri. V K Sreekandan:

Will the Minister of FINANCE be pleased to state: -

- (a) Whether  it  is  a  fact  that  the  Government  has  been  encouraging  taxpayers  to voluntarily update the tax return via use of Artificial Intelligence tools;
- (b) Whether it is also true that this encouragement has helped the Government to collect additional tax revenue of Rs. 11,000 Crore in 2024-25;
- (c) Whether it is also true that Artificial Intelligence tools also aided the disclosure of Rs. 29,000 crore previously undisclosed foreign assets and Rs. 1,000 crore foreign income  related  to  cryptocurrencies  or  virtual  digital  assets  in  2024-25,  if  so  the details thereof;
- (d) Whether  it  is  also  a  fact  that  the  Government  has  generated  Annual  Information Statements  for  about  40  crore  unique  taxpayers,  nine  Crore  of  those  actually  file returns; and
- (e) If so, the details thereof and the reasons therefor?

## ANSWER

## THE MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI PANKAJ CHAUDHARY)

- (a) The  Income  Tax  Department  has  undertaken  various  e-campaigns  to  encourage taxpayers to voluntarily update their Income tax returns. These efforts include, inter alia, carrying  out  initial  e-verification  campaigns.  By  enhancing  data  accuracy, consistency and integrity, AI-enabled processes have been utilised to strengthen the analytics  framework  and  support  the  selection  of  appropriate  cases  for  outreach.

This,  in  turn,  facilitates  fair,  precise,  and  effective  communication  with  taxpayers, thereby  promoting  voluntary  compliance  and  reinforcing  transparency  in  the  tax administration system.

- (b) Yes, Filing of Updated Income Tax Returns in respect of Assessment years 2020-21 to 2024-25 has generated additional tax revenue of more than Rs 11,000 Crore.
- (c) Using  Data  Analytics,  a  NUDGE  (Non-Intrusive  Usage  of  Data  to  Guide  and Enable)  Taxpayers  Campaign  was  launched  by  the  Income  Tax  Department  in November  2024  to  improve  taxpayers'  voluntary  compliance  for  declaration  of foreign income and assets. Under the campaign, informational messages were sent via  SMS and email to selected resident taxpayers in respect of whom information has  been  received  under  the  Automatic  Exchange  of  Information  that  they  are holding  foreign  assets  and/or  having  income  from  foreign  sources,  to  accurately report  foreign  assets  and  report  income  from  foreign  sources  in  their  Income  Tax Returns.  Total  of  24,678  taxpayers  reported  their  foreign  assets  and  income  in revised ITRs for AY 2024-25, while 5,483 taxpayers filed belated returns reporting foreign assets worth Rs. 29,208 crore and foreign income of Rs. 1,089.88 crore.
- (d) to (e)   AIS for 46.7 Crore PANs have been generated for transactions of FY 2024-25. For transactions pertaining to FY 2023-24, AIS was generated for 45.1 crore taxpayers. The wide net of transactions  covered  under  Annual  Information  Statements  (AIS) results in a much higher number of statements being generated compared to actual Income tax return filers. It is pertinent to point out that many individuals, in respect of  whom  AIS  is  generated,  may  not  have  the  taxable  income  above  the  statutory threshold required for mandatory filing of income tax return. AIS data also helps the Income  Tax  Department  identify  and  nudge  non-filers  and  improve  voluntary compliance

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