India to ink G20 pact, will get more data on bank a/cs
NEW DELHI: Months after it failed to sign the G20 information sharing agreement, India is set to sign the global treaty on June 3 which will enable it to access data related to bank accounts from across the world, including tax havens that were earlier refusing to cooperate.
While information under the agreement finalized at the OECD will start flowing in from 2017, the government is also ready to sign Foreign Account Tax Compliance Act (FATCA) with the US, which will be effective from September and is expected to result in additional data flow, sources said.
Both the agreements had to be signed last year but the government had to drop its plans at the last minute in the wake of a Supreme Court observation related to confidentiality clause in the treaties as well as the double taxation avoidance agreements. But with the legal hurdle out of the way, the Cabinet has now endorsed the two pacts. Sources said the date and other modalities for signing FATCA are being worked out with the US government.
India has been at the forefront of the efforts at OECD to get countries to share of all bank information with tax authorities on an annual basis. Currently, countries can seek information from others but the new mechanism will allow automatic exchange of information on an annual basis, which will include the account balance and all income.