New Delhi/Berne: India has received first tranche of details about financial accounts of its residents in Swiss banks under a new automatic exchange of information (AEOI) framework between the two countries. This marks a significant milestone in the fight against black money suspected to be stashed abroad.
India figures among 75 countries with which Switzerland’s Federal Tax Administration (FTA) has exchanged information on financial accounts within the framework of global standards on AEOI, an FTA spokesperson told this agency.
This incidentally is the first time that India has received details from Switzerland under the AEOI framework, which provides for exchange of information on financial accounts that currently active as well as those accounts that were closed during 2018. The next exchange would take place in September 2020, the spokesperson added.
However, the exchange is governed by strict confidentiality clauses and the FTA officials refused to disclose specific details on the number of accounts or about the quantum of financial assets associated with the accounts of Indian clients of Swiss banks.
Overall, the FTA has sent information on around 3.1 million financial accounts to partner states and received information on around 2.4 million from them.
The exchanged information includes identification, account and financial information. These include name, address, state of residence and tax identification number, as well information concerning the financial institution, account balance and capital income.
The data was collected by the FTA from around 7,500 institutions including banks, trusts and insurers.
“The largest exchange was with Germany (in both directions), as was the case in the previous year. The FTA cannot provide any information on the amount of financial assets,” an FTA statement said.
According to experts, the data received by India can be quite useful for establishing a strong prosecution case against those who had any unaccounted wealth, as it provides entire details of deposits and transfers as well as of all earnings, including through investments in securities and other assets.
On condition of anonymity, several officials said the details relate mostly to businessmen, including non-resident Indians now settled in several South-East Asian countries as well as in the US, the UK and even some African and South American countries.
Besides, there are at least 100 cases of older accounts held by Indians, which might have been closed before 2018, for which Switzerland is in the process of sharing details with India under an earlier framework of mutual administrative assistance as Indian authorities had provided prima facie evidence of tax-related wrongdoings by those account holders.