New Delhi | Jagran News Desk: In what could be a key milestone in Modi government's fight against black money stored abroad, Switzerland on Friday shared details about 3.1 million financial accounts with 86 countries. Switzerland had also shared financial details about Swiss bank clients with India in September 2019 under Automatic Exchange of Information (AEOI).

Under the automatic information exchange framework, Switzerland's Federal Tax Administration (FTA) on Friday shared details about financial accounts of clients of Swiss banks and various other financial institutions with 86 countries, including India.

According to a report by news agency PTI, Switzerland has also shared information about more than 100 Indian citizens and entities in the past one year on receipt of requests for administrative assistance in cases involving probes into financial wrongdoings including tax evasion. The report, however, has not mentioned about the number of accounts or the quantum of assets held in the accounts held by Indians, for which the information has been shared with India.

The information shared by Swiss authorities include identification, account and financial information, such as name, address, country of residence and tax identification number, as well as information concerning the reporting financial institution, account balance and capital income.

The exchanged information will allow tax authorities to verify whether taxpayers have correctly declared their financial accounts in their tax returns. The next exchange would take place in September 2021.

In its statement, FTA said the 86 countries covered under the AEOI this year include 11 new jurisdictions -- Anguilla, Aruba, Bahamas, Bahrain, Grenada, Israel, Kuwait, Marshall Islands, Nauru, Panama and the United Arab Emirates -- in addition to the existing list of 75 countries, with whom information was shared last year.

Further, FTA said the exchange of information this year has been reciprocal with 66 countries. In the case of 20 countries, Switzerland received information but did not provide any, either because those countries do not yet meet the international requirements on confidentiality and data security (9 countries) or because they chose not to receive data (11 countries).

A total of 38 countries will supply their data to Switzerland in accordance with the Global Forum on Transparency and Exchange of Information for Tax Purposes (Global Forum) by December 31, 2020. These countries have claimed technical difficulties due to the COVID-19 crisis.

Switzerland's first such exchange took place at the end of September 2018 and involved 36 countries, but India did not figure in the list at that time.

Currently, around 8,500 reporting financial institutions (banks, trusts, insurers, etc) are registered with FTA. These institutions collected the data and transferred it to FTA. The count has increased from about 7,500 last year.

FTA sent information on around 3.1 million financial accounts to the partner states and received information on around 8,15,000 financial accounts from them. FTA also said it cannot provide any information on the amount of financial assets.

Switzerland has committed itself to adopting the global standard for the international automatic exchange of information in tax matters. the legal basis for the implementation of aeoi in switzerland came into force on January 1, 2017.

However, AEOI only relates to accounts that are officially in the name of Indians and they might include those used for business and other genuine purposes.

The Global Forum of the Organisation for Economic Cooperation and Development reviews AEOI implementation.

According to experts, the data received by India can be quite useful for establishing a strong prosecution case against those who have 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.

A Swiss delegation was in India in August last year before the first set of details could get shared and the two sides also discussed possible steps to expedite the execution of tax information-sharing requests made by India in specific cases.

It is feared many Indians might have closed their accounts after a global crackdown on black money led to Switzerland buckling under international pressure to open its banking sector for scrutiny to clear the long-held perception of Swiss banks being safe haven for undisclosed funds.

Switzerland agreed to AEOI with India after a long process, including a review of the necessary legal framework in India on data protection and confidentiality.

(With PTI inputs)

Posted By: Aalok Sensharma