Giving an update on alleged tax evasion through offshore accounts, Finance Minister P Chidambaram on Monday said in his Interim Budget speech that the government has succeeded through alternative methods and special efforts in obtaining information in 67 cases ‘despite several hurdles’. (Agencies)
He said that action is underway to determine the tax liability as well as imposition of penalty in these 67 cases. "Prosecutions for willful tax evasion have been launched in 17 other cases. More enquiries have been initiated into accounts reportedly held by Indian entities in no tax or low tax jurisdictions," he added.
"There has been much debate on illegal offshore-accounts held by Indians. Investigations into such accounts were launched in 2011," Chidambaram said.
The statement assumes significance as the matter of alleged tax evasion through offshore accounts would be discussed at the G-20 meeting of Finance Ministers later this month in Australia, where Chidambaram would also be present.
Paris-based OECD (Organisation of Economic Cooperation and Development) will also present there a new global standard for automatic exchange of information on offshore tax evasion, which was adopted last week by India and 41 countries.
The issue of alleged tax evasion by Indians through banks and other entities in offshore locations, especially Switzerland, has been matter of a political debate in India. It has been alleged that Swiss banks have been used in a big way for years to stash black money by Indians and the matter is also expected to be a key issue in the upcoming elections in India.
Welcoming the OECD framework to fight offshore tax evasion, 42 jurisdictions including India said in a joint statement that such a global collaboration was necessary to ‘clamp down on this harmful and abusive activity which reduces public revenues and increases the burden on those who pay their taxes’.
After presenting this new standard in Sydney during G-20 meeting from February 22-23, OECD will come out with details of the new standard, as well as technical solutions to implement the actual information exchanges in September 2014. This framework calls on jurisdictions to obtain information from their financial institutions and exchange that information automatically with other jurisdictions on an annual basis.
Giving an update on alleged tax evasion through offshore accounts, Finance Minister P Chidambaram on Monday said in his Interim Budget speech that the government has succeeded through alternative methods and special efforts in obtaining information in 67 cases ‘despite several hurdles’.