NEW DELHI: Union cabinet minister Arun Jaitley has hit out at the opposition for running an ill-informed campaign on reports about rise in deposits by Indians in Swiss banks, saying all money parked there is not illegal especially in the backdrop of stringent disclosure and information sharing agreements inked by Switzerland.
Jaitley pointed to rise in jump of 44% in the personal income tax category and 17%, terming the “unprecedented taxation growth” a result of the anti-black money measures, use of technology, demonetisation and the Goods and Services Tax.
A top government official said the tax base could rise 80-90% over the next five years, which would have a big positive impact on the fiscal situaton.
“Switzerland has taken significant efforts to get out of the image of being a tax haven and a non-compliant State. It is on the verge of making disclosures in real time and, therefore, is no longer an ideal destination for tax evaders,” Jaitley said in a blog post on Friday.
Data released by the Swiss National Bank on Friday showed money parked by Indians in Swiss banks rose over 50% to 1.01 billion Swiss franc (Rs 7,000 crore) in 2017, reversing a three-year downward trend amid India's clampdown on suspected foreign black money.
Piyush Goyal, who holds the interim charge of finance ministry, also questioned the view that all money in Swiss accounts was black money.
“To assume that all the deposits are per se tax evaded money or that Switzerland in the matter of illegal deposits is what it was decades ago, is to start on a shaky presumption,” Jaitley said.
Jaitley pointed that Switzerland in financial disclosures was always a reluctant state, but of late it was subjected to a lot of international pressures which favoured disclosures running the risk of being a ‘non-compliant’ State by the Financial Action Task Force.
“It has, therefore, entered into several bilateral treaties for making disclosures to requesting States. It has amended its domestic laws involving all disclosures and entered into a treaty even with India and real time flow of information with regard to Indians will be made,” he said.
The flow of information is starting in January, 2019, he said, adding that any illegal depositor knows that it is a matter of months before his name becomes public and he will be subjected to the harsh penal provisions of the Black money law in India.
Jaitley said past investigation by the Central Board Direct Tax have shown that Swiss money includes that held by persons of Indian origin who now hold foreign passport, monies belonging to Non-Resident Indians, as also monies belonging to resident Indians who have made legitimate investments abroad, including transfer of money under the liberalised remittance schemes.
Only monies kept by resident Indian outside these categories which become actionable, he said.
IMFORMATION SHARING AGREEMENT
Goyal also wondered if all the Indian money in Swiss banks could be assumed to be black money, while adding that strong action would be taken against anyone found guilty.
"The data that you alluded to will come to us in due course, so how are you assuming that this is black money," he said. “There could be some non-resident Indians as well. I don’t know,” Goyal said on the sidelines of an event in Delhi.