The Swiss authorities have shared details of bank accounts of Indians and entities. These are the accounts of people who are allegedly holding black money in Swiss accounts. According to sources, this is part of a confidential agreement between the two countries. Agencies dealing with black money investigations will examine this data. They will see if there are any irregularities in these bank accounts belonging to Indians.
The latest exchange of financial data by FTA, Switzerland’s Federal Tax Administration is the second time for the last one year. This is part of the framework of the global standard on the Automatic Exchange of Information. It will help in combating the problem of offshore tax evasion. And also help combat avoiding and stashing of unaccounted money abroad requiring cooperation amongst tax authorities. The information exchange this year is with 86 countries including India. According to FTA, the data involves nearly 3.1 million financial accounts. It is not out exactly how many of these millions of accounts have links to Indians.
The AEOI Program That Will Help In Getting The Bank Accounts Details Of Tax Evaders
India has activated the AEOI relationship for receiving information from over 96 jurisdictions. This is from countries such as Switzerland, the British Virgin Islands, Luxembourg, Bahamas, and Mauritius. Switzerland and India had signed a joint declaration on the introduction of AEOI on tax matters on 22nd November 2016 on a reciprocal basis. According to a finance ministry official, the first set of data on Indian accounts was shared in September last year for the year 2018.
The official further said that the data received will be processed by tax authorities and agencies. And the processing of this information will also take time. If they found some suspicious activities involving certain individual accounts, agencies will probe their details further. And on the basis of material evidence, notices will be served and taxes along with penalties will be recovered. This official declined to reveal any further detail because of the confidential agreement.
AEOI is an important tool of the Global Forum. This is to help countries get important information on an automatic basis instead of a request. This will help countries use this provided information to investigate whether account holders have correctly paid taxes on these overseas assets. Overseas assets by Indians are a focus area of the Indian government. And this exchange of information would form the backbone of the quest to bring to task the tax evaders who have stashed money abroad.
The Global Forum is a step in the right direction towards a more cohesive exchange of financial accounts between different countries. Safe havens and lack of transparency, boasted by some countries for foreign investment attraction remain a big impediment to the global fight against money laundering and financial crimes. Although there still is a long way to go for meaningful reform.