CA Neha Bhuwania
May 6’ 2014 was a day which should create fear of the worst by the Indian Nationals who have shrouded their black money at the Swiss. It was at this day when Switzerland has signed for mutual cooperation in tax matters at the convention.
Our finance minister Mr P Chidambaram has been continuously pressing the Swiss authorities at Switzerland for assistant in tax probe matters. This request is followed by the adoption of the global declaration for automatic exchange of tax information under the aegis of OECD [Organisation for Economic Cooperation and Development].
It has been a well noted fact that most of the Indian big shots have concealed their “undeclared” income in the Swiss accounts as there was no mutual cooperation agreement between the two countries for mutual exchange of tax related information.
As of now, in spite of repeated reminders and requests, no ratification has been done by the Swiss Authorities. The controversy remains the same. Can a top shot Indian National be pardoned from paying genuine taxes and declaring his “other” sources of income, just because he holds an account at the Swiss? The bank has been well known for its top secrecy rules about the clients who hold accounts with them along with the holding details. The big question is- Does signing this declaration by them actually brings the nationals holding accounts there under the lime light or the trend of export of money from India shall continue on account no such ratification till date?
With the power of RTI as well, the common Indian still does not have sufficient measures to know where does the public money paid as taxes (Both direct and indirect taxes) goes. How much of it is behind the veil of these foreign bank accounts with no traces?
As per The Hindu, a leading newspaper, the details released by the Swiss National Bank (which is the central bank of Switzerland) says that the funds held by the Indians in the Swiss Banks have risen by 370 million Swiss Francs which is close to Rs. 11,800 crores in the year 2011. Due to the high secrecy levels maintained by the bank, not much information about the holders of such large chunk has been made public. However, the increase in holdings is growing exponentially year on year.
The value of Rupee has been diminishing at the International level on one hand and on the other, crores of Rupees have been swiped off from the country by so called Indian nationals. This has no direct link with patriotism, it is just about paying what you are due to pay.
Just by opening a bank account abroad, any Indian doesn’t get a right to escape the tax liabilities in the home country. With the Modi government in force, hope this prolonged controversy shall end and there shall be a more transparent structure with tax liabilities for the nationals with the common public having a right to know where the public money has been utilized and does proprietary audit actually help.
(Author is Co-founder & Managing Director of FxMantra and can be reached at nehabhuwania18 @ gmail.com )