Nitin Gupta, Chairman of the Central Board of Direct Taxes (CBDT), emphasized the proactive stance of the Indian Income Tax Department in reviewing bank accounts held by Indian individuals and entities in Swiss Banks.
These disclosures have arisen through Switzerland’s annual automatic information exchange program, which has shared details from around 3.6 million financial accounts with 104 countries. Mr. Gupta revealed these details during an exclusive interview with ANI.
The most recent data exchange is the fifth of its kind, following the initial sharing of information between India and Switzerland in 2019. Gupta underscored the Income Tax Department’s thorough examination of this information. When Indian citizens hold assets in foreign nations without properly notifying Indian tax authorities, subsequently incurring tax liabilities, the department will take action under the black money legislation.
India continues to benefit from the Automatic Exchange Of Information (AEOI) agreement initiated in 2018 between the two countries, receiving the fourth phase of data from Switzerland in October 2022. This agreement aims to strengthen tax compliance and deter potential tax evasion.
The primary objective of this annual information exchange is to enable governments to verify whether their citizens have accurately reported their overseas bank accounts in their tax returns. It’s important to note that the Swiss authorities conduct this exercise solely for tax-related purposes, and the Central Board of Direct Taxes (CBDT) in India manages and utilizes the data.
Ralf Heckner, Switzerland’s Ambassador to India, made a significant observation about the issue of black money in early January 2023 when speaking to ANI. He noted that there had been limited discussion of black money during his tenure as the Swiss Ambassador, largely due to the effective resolution of the matter through a bilateral treaty between Switzerland and India. This treaty facilitated the automatic exchange of banking information between the two countries, addressing concerns related to black money.
The proactive approach taken by Indian tax authorities reflects the government’s commitment to combat tax evasion and ensure compliance with tax regulations.
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