India for removal of distinction between tax evasion and fraud

Posted By: Pti
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New Delhi, Feb 21 (PTI) India has decided to press forremoval of distinction between tax evasion and tax fraud whichhas helped Indians conceal their income in tax havens abroad.

This is part of India''s drive to get back the moniesabroad.

Sources said that a number of countries have refusedto give information on the ground that tax evasion was not anoffence under their law but if tax fraud was included theywill cooperate.

The point was forcefully made at G-20 meeting offinance ministers and central bank governors in Paris lastweek end.

Pointing out that different definitions of expressionslike "tax evasion" and "tax frauds" leads to problems,Mukherjee said there was a need to harmonize them thatcountries can exchange information without any hindrance.

"Some countries/jurisdictions differentiate betweentax fraud and tax evasion. This difference in perceptionassists deliberate concealment of wealth for the purpose ofevading tax, something regarded as crime all over the world,and impedes effective exchange of information.

"We should encourage countries to remove thisdistinction in order to help efforts of government authoritiesin pursuing tax cheats who have parked funds outside thecountry", he said in his address at the ministerial meeting atthe G-20.

The Minister further said that India was in theprocess of revising its Double Taxation Avoidance Agreement(DTAA) with all the 78 countries which whom it had signed suchagreements.

"Revision of DTAA with 10 countries have beencompleted and many more are in the offing", he said. RevisedDTAA will help in seeking banking information about theoffenders.

He also raised the issue of ill-gotten money beingstashed abroad during his bilateral meetings with FrenchFinance Minister Christine Lagarde and his German counterpartWolfgang Scheuble.

Mukherjee, who is spearheading the fight against taxevasion at G-20 grouping, said that about 500 tax informationexchange agreements have been signed between differentcountries across the world, a development that would help inthe fighting the menace tax evasion and track ill-gottenmoney.

The Minister also underlined the case for collectiveaction against those countries which refuse to part with taxand banking information essential for tracking slush funds.

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