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June 2009

Black money trail : Swiss ready to revise treaty

By Raman Jokhakar, Tarunkumar Singhal, Chartered Accountants
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  1. Black money trail : Swiss ready to revise treaty

The Government has approached Swiss authorities to renegotiate its Double Taxation Avoidance Agreement (DTAA), a tax treaty between the two countries in force since 1995, to obtain details of bank accounts maintained by Indians in Switzerland.

The Swiss Government has in the past refused to share bank information pertaining to Indians with New Delhi on the ground that such details were not necessary for application of the DTAA. Swiss authorities had expressed inability to provide details, citing their own laws, since India’s requests were related to enforcement of its internal tax laws.

India is part of the task force constituted by the G-20 at its London summit to formulate a “global plan for recovery and reform which promises to take action against non-cooperative jurisdictions, including tax havens and also to deploy sanctions to protect public finances and financial systems”. On alleged role of Swiss banks in the 2004 stock market crash, the affidavit said that Securities and Exchange Board of India had in 2005 barred Swiss financial institution UBS Asia from issuing and renewing any participatory notes for a year. But this was following its refusal to disclose information relating to an investigation carried out by SEBI, not for its role in the market crash.

(Source : The Times of India, dated 04.05.2009)

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