DIRECT TAXES
| Govt may ask tax havens to recover dues from Indians Wed, 16 Feb 2011 22:25:26 GMT |
| NEW DELHI: The government will ask tax havens to recover taxes from Indian nationals who have stashed undeclared income there as it intensifies efforts to tackle the menace of black money. It is also keeping tabs on those frequenting such tax jurisdictions. "We can ask these countries to recover taxes," a finance ministry official said. The tax information exchange agreements and revised double taxation avoidance agreements ( DTAAs )) entered into with some of these jurisdictions have a provision for providing assistance in recovery and the income-tax department plans to use this provision. The Central Board of Direct Taxes has opened income-tax units in some of these jurisdictions to facilitate information exchange and coordinate recovery of taxes. Two such income-tax units have been set up within Indian missions in Singapore and Mauritius and one each is proposed to be set up in the US, the UK, the Netherlands, Japan, Cyprus, Germany, France and the UAE. Further, income tax officials are also being posted in some of the tax havens. India recently signed tax information exchange agreements with Bahamas, Bermuda, British Virgin Islands and Isle of Man for access to information on bank accounts of Indian nationals there. Based on the information received, the department will step up the recovery process here. Those found to have evaded taxes will have to pay 100% interest on the tax and penalty up to 300%. Back home, the department is keeping a close watch on visits by Indian nationals to tax havens and those suspected to have bank accounts there. Investigation directorates have collected data from agents and officials of foreign banks offering services and soliciting opening of foreign banks accounts. They are also receiving data from the financial intelligence unit in India that has begun to receive data from other FIUs. As part of the drive against black money, the income-tax department had recently issued show-cause notices to some of the foreign account holders in addition to those in the list given by Liechtenstein. Black money has taken political centre stage with the BJP launching a scathing attack on the UPA and the Supreme Court calling the menace a "plunder of the nation". Different estimates like the one by a BJP task force pegged the amount of black money between $500 billion and $1.4 trillion while another international estimate placed such flows at $462 billion. |
Online Poll