Tax havens ready to share info: Govt

“As a consequence of the initiative and pressure brought to bear by India,many tax havens have now agreed to end banking secrecy. In addition,the principle of domestic interest while exchanging information for tax purposes is also being relaxed,” the affidavit filed by Anoop Kumar Srivastava,Joint Secretary,Department of Revenue,Ministry of Finance,stated.

The TIEAs,the government says,have swept aside the mandatory “principle of domestic interest” under which a foreign country need not provide information to a country requesting it unless the offence under investigation is an offence there too.

The affidavit said the government has already completed negotiations of TIEAs with 10 countries,namely Bahamas,Bermuda,British Virgin Islands,Isle of Man,Cayman Islands,Jersey,Monaco,St Kitts and Nevis,Argentina and Marshall Islands. The Cabinet has already approved eight of these agreements,it added.

But on the flip side,in major countries like Switzerland and Germany,TIEAs do not have an independent existence,but is only a miniscule part of Double Taxation Avoidance Agreement (DTAA).

In Switzerland’s case,India is still waiting for the Swiss to ratify an amended DTAA in which there is a broader scope for free tax information sharing between the two countries.

The February affidavit had promised that the ratified DTAA would “allow India to obtain banking information as well as information without domestic interest from Switzerland in specific cases for the period beginning April 1,2011”.