BANGALORE: In response to the letter written by finance minister P. Chidambaram, the Swiss finance minister Eveline Widmer-Schlumpf has informed that the Swiss authorities can’t share the details of the bank accounts held by Indians in Swiss bank without the consent of the account holders, reports Economic Times.
India has sought the information under the Double Taxation Avoidance Agreement that was signed by the two countries in 2011. The Swiss finance minister has said they are not bound to share information on accounts opened before 2011. The letter further stated that according to Swiss bank secrecy laws, they are bound to inform the account holder that a foreign country is seeking their information. If the account holder refuses to share the information, the Indian government has the option of taking help of Swiss courts.
An Indian official shed light on the Indian government’s stand on this-“A reply has been sent. We have informed the Swiss government that this (seeking information on bank accounts) is a sovereign request and individuals can't be notified. And information has to be shared under Article 26 of the treaty signed between the two countries, which overrides Swiss domestic laws”. He further stated, “India is also trying to bring pressure on Switzerland through G20. And if even that doesn't work out, we have the option of invoking Section 94(A) of the Income-Tax Act and declare Switzerland a Non-Cooperative Jurisdiction.”
The other country which has been declared non-cooperative jurisdiction by India is Cyprus for its unwillingness to share information requested by Indian tax authorities.
Finance minister P. Chidambaram in his budget speech talked about difficulties in obtaining such information. He had also said, “The government has succeeded, through alternative methods and special efforts, in obtaining information in 67 cases and action is underway to determine the tax liability as well as impose penalty. Prosecution for willful tax evasion has been launched in 17 other cases. More enquiries have been initiated into accounts reportedly held by Indian entities in no-tax or low-tax jurisdictions.”
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