BY ECONOMICTIMES.COM | JUN 16, 2017, 03.47 PM IST
Switzerland's age of banking secrecy is finally coming to an end. On Friday, Switzerland ratified automatic exchange of financial account information with India, marking another step in addressing the menace of black money stashed abroad.
With this move, India should be able to access transactions by Indians with Swiss banks after September 2019.
This is a big boost for Modi government's move against black money. It will now be possible for India to receive from September, 2019 onwards, the financial information of accounts held by Indian residents in Switzerland for 2018 and subsequent years, on an automatic basis.
The finance ministry, last year, had noted that that there is no official estimation regarding black money of Indians stacked in Swiss banks.
"Recent media reports have quoted Zurich based Swiss National Bank as saying that money held by Indians in Swiss banks has fallen by nearly one-third," minister of State for finance, Santosh Kumar Gangwar had said in a statement in Lok Sabha.
"These reports also say that the funds, described by Swiss National Bank as 'liabilities' of Swiss banks or 'amounts due to' their clients, are the official figures disclosed by the Swiss authorities and do not indicate to the quantum of alleged black money held by Indians in Switzerland," he had said.
In the recent past, the government has taken several steps to effectively tackle the issue of black money, which include policy-level initiatives, more effective enforcement action on the ground, putting in place robust legislative and administrative frameworks, and integration of information and its mining through increasing use of information technology.
A new law - 'The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015' - has been enacted to specifically and effectively tackle the issue of black money stashed away abroad.
The government had also given a one-time three months' compliance window under the new law wherein 648 declarations involving undisclosed foreign assets worth Rs 4,164 crore were made. The amount collected by way of tax and penalty in such cases was Rs 2,476 crore.
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