Published: 7th Sep, 2019
Switzerland to share bank account information with India
Context
Switzerland to share bank account information with India
About
- Banking details of Indians with accounts in Switzerland will be available to tax authorities as the automatic exchange of information regime kicks off between the two countries.
- The move is a significant step in the government’s fight against black money and the era of “Swiss bank secrecy”.
- India will receive information of the calendar year 2018 in respect of all financial accounts held by Indian residents in Switzerland.
Automatic Exchange of Information
- The new global standard on Automatic Exchange of Information (AEOI) reduces the possibility for tax evasion.
- It provides for the exchange of non-resident financial account information with the tax authorities in the account holders’ country of residence.
- Participating jurisdictions that implement AEOI send and receive pre-agreed information each year, without having to send a specific request.
- It will enable governments to recover tax revenue lost to non-compliant taxpayers, and will further strengthen international efforts to increase transparency, cooperation, and accountability among financial institutions and tax administrations.
- Additionally, AEOI will generate secondary benefits by increasing voluntary disclosures of concealed assets and by encouraging taxpayers to report all relevant information.
- As new information is brought to light by AEOI, the importance of the current standard of Exchange of Information on Request (EOIR) will also increase. The two standards of AEOI and EOIR are therefore complementary, working together to enhance the effectiveness of tax administrations’ efforts in addressing international tax evasion.
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