FIRST ORDER 25%

We recommend

Thursday, October 30, 2014

Swiss jolt: Reminds govt of terms for sharing bank info




`Tax Treaty Bars Giving Secret Data To Courts'
In a fresh threat to the flow of information about Indians holding accounts in foreign banks, Switzerland on Thursday said that information exchanged with India under its tax treaty can't be disclosed "in principle" to a court or any other body outside the proceedings of a "specific and relevant" case.

This Swiss clarification came after the Centre was ordered by the Supreme Court to hand over all 627 names of Indian account holders in HSBC Bank, Geneva, forcing India to opt out of signing a treaty on exchange of financial information.

"The double tax agreement between India and Switzerland is in line with international standards and provides for exchange of information on request," a Swiss finance ministry official told PTI on Thursday ."Information exchanged und er terms of the DTA can be provided to a court in situations where it is dealing with a specific case related to tax matters." Conversely , information cannot be disclosed in principle to a court or another body outside of such proceedings," the Swiss finance ministry official added.

Explaining the treaty provisions about disclosure of `secret' information, a Swiss finance ministry spokesperson told PTI from Berne that authorities from the two countries have "regular contacts on bilateral tax matters" but refused to comment on particular cases.

The exchange of information on tax matters between India and Switzerland is based on the double taxation agreement and protocol that was signed in 2010 between the two countries.It has been in force since October 2011.

India's last minute withdrawal from the Multilateral Competent Authority Agreement -which provides for automatic information exchange, starting 2017 -is bound to choke the flow of vital data to tax authorities and hinder attempts to act against unaccounted funds parked in overseas accounts.

India can still sign the pact.Currently , it is awaiting clarity from the SC. The source pointed out that India also has to sign the Inter-Governmental Agreement with the US for automatic exchange of information.

The treaty with the US again comes with a confidentiality clause. Officials said in case of a delay beyond December 31, all remittances from the US will face a 30% withholding tax. "For signing the agreement, the government has to give a commitment that it will follow international standards for the information received.But we could not give an assurance due to Supreme Court's interpretation of confidentiality , which is critical for all governments to exchange information," said a government offi cial. Swiss authorities, too, are worried about sharing information and their comments come at a time when a SC-monitored Special Investigation Team (SIT) is probing alleged stashing of black money by Indians aboard.

There has been a heated debate here on whether the disclosure of names, without prosecution, could violate tax treaties under which these names and other details are shared by foreign countries.

Replying to queries in this regard, the Swiss Federal department of finance spokesper son said the protocol to SwissIndian Double Taxation Agreement states that any information received "by a contracting state shall be treated as `secret' in the same manner as information obtained under the domestic laws of that state..."

The treaty further provides that any such information "shall be disclosed only to persons or authorities (including courts and administrative bodies) concerned with the assessment or collection of (information), the enforcement or prosecution in respect of, or the determination of appeals in relation to the taxes ... or the oversight of the above."

For the full report, log on to http:www.timesofindia.com

No offenders will be spared: Shah

New Delhi: Justice M B Shah, heading the SC-appointed Special Investigation Team supervising black money probe, said on Thursday that there are names other than the 627 submitted by the government to the apex court which he is trying to gather and those will be investigated as well. In an interview to a TV channel, Justice Shah said no offenders -big or small -will be spared and SIT will submit its report by the first week of December. TNN








0 comments:

 

blogger templates | Make Money Online