By IANS,
New Delhi: In the first step towards bringing back unaccounted money stashed away in tax havens abroad, the Indian government Tuesday said it has entered into accords with nine jurisdictions to share information on such transactions.
“Now the central government can initiate and negotiate agreements for exchange of information for the prevention of evasion or avoidance of income tax and assistance in collection of income tax with these nine specified territories,” an official statement said.
The nine jurisdictions include Guernsey, Isle of Man, Jersey (all British Crown Dependencies), the Netherlands Antilles (an autonomous part of the Dutch kingdom) and Macau (a special administrative region of the People’s Republic of China).
The notification of Hong Kong, a Special Administrative Region of China, as a specified territory for the purpose of Section 90 of the Income Tax Act 1961 is also under process.
India’s Income Tax Act was amended in 2009 to enable the government to enter into an agreement with any specified territory outside the country, in addition to the already existing provision of agreement with the government of that country.
While no official data is available on the quantum of slush funds, it is estimated that such black money stashed away by Indian nationals in tax havens overseas could be worth nearly $140 billion.
Switzerland is another major tax haven that the government is negotiating a tax disclosure treaty.
As per data available with the Organisation for Economic Cooperation and Development (OECD), India is among the 40-odd nations that have substantially implemented the globally accepted norms on exchange of information on tax.
Finance Minister Pranab Mukherjee has also ordered re-negotiation of all the 77 double-tax avoidance pacts entered into so far to get real time information and track tax evasions or stashing away of black money in other countries.