PC warns Switzerland on black money

PC warns Switzerland on black money

India may examine steps like declaring Switzerland a non-cooperative jurisdiction and may be forced to take a position against it in the global fora such as G20 if the European nation does not share information at the earliest on black money parked by Indians in its banks.

Finance Minister P Chidambaram has shot a letter to his Swiss counterpart Eveline Widmer Schlumpf warning India will not hesitate to tell the world that Switzerland still does not comply with the standards of transparency and that the required legal and regulatory framework is still not in place there.

“If information continues to be denied to India under the Double Taxation Avoidance Convention (DTAC), the Government of India will be constrained to take a position in the global forum,” he said in the letter dated March 13, a copy of which was released to the media on Thursday.

Chidambaram said Switzerland has not honoured the terms of the Double Taxation Avoidance Agreement (DTAA) between the two nations, under which information about Indians with accounts in Swiss banks has been sought by the tax authorities.

“Switzerland’s refusal to provide information to India and other countries on the grounds that the source of the information requested is based on ‘stolen data’ means that, in practice, Switzerland still believes in bank secrecy and is therefore not in tune with the modern era,” he said.

The finance minister also reminded Schlumpf of the April 2009 declaration adopted by G20 leaders which stated that the “era of bank secrecy is over.”

He hoped that the Swiss government would be able to persuade its parliament to agree to the proposed changes in its domestic law to comply with internationally accepted standards and conventions.

“Switzerland cannot violate its obligations under the DTAC with India on any ground, including on moralistic grounds, when the Government of India has all along acted in good faith and has requested the information in a bonafide manner,” Chidambaram added.

The Supreme Court held on Wednesday that no effort was made to bring back the money stashed in foreign banks which could have been accounted and pumped into “mainstream Indian economy.”

The government, however, said it would continue to make serious efforts to recover the unaccounted wealth parked by Indians in foreign banks.

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