I-T returns may require disclosure of all assets

In a bid to counter tax evasion, the Finance Ministry is contemplating making it mandatory for individuals and Hindu Undivided Families (HUFs) to report Indian assets and liabilities in income-tax (I-T) return forms.

"The government is considering to introduce a new income tax return form that will require individuals to disclose all their assets and liabilities, rather than just annual income from various sources," a senior finance ministry official said.

The official further said that the decision will be taken in the next two days. Last year, reporting of assets and liabilities was made mandatory for individuals with foreign assets.

The official said the intention is mainly to get information about those High Networth Individuals (HNIs) who have not been declaring all their assets to avoid paying wealth tax.

In the financial year 2012-13, wealth tax collections stood at Rs 866 crore -- much lower than the Budget estimate of Rs 1,244 crore.

For 2013-14, the Finance Ministry has set a collection target of Rs 950 crore. In the Union Budget, the government levied a surcharge of 10 per cent on annual taxable income above Rs 1 crore and imposed tax deducted at source on transfer of immovable property costing more than Rs 50 lakh.

At present, wealth tax is charged at 1 per cent of the value of assets exceeding Rs 30 lakh and does not include one residential property and financial assets.