The third set of Swiss bank account details of Indians under an automatic exchange of information pact with Switzerland will be revealed this month, officials told news agency PTI. It is for the first time that the data will include details about real estate properties owned by Indians there. This could be seen as a key milestone in the Indian government’s fight against black money allegedly stashed abroad. According to officials, India will get the complete information on flats, apartments and conominiums owned by Indians in Switzerland as also on earnings made from such properties to help it look into tax liabilities associated with those assets.
WHAT IT MEANS
- India receiving the third set of Swiss bank account details assumes significance on the part of Switzerland as well as the European Alpine nation is trying hard to reposition itself as a key global financial centre while warding off the long-perception about the Swiss banking system being an alleged safe haven for black monet.
- Even though it is for the third time that India will get details about bank accounts and other financial assets held by Indians in Switzerland, it will be the first time that the information being shared with India would include information about the real estate assets.
- However, there is something that still remains out of bounds from the automatic exchange of information framework. This includes information about contributions to non profit organisations and other such foundations, as also details on investments in digital currencies.
- According to experts, the move would help clear misconceptions about all fund inflows into Swiss assets being illicit and would go a long way in establishing Switzerland as a preferred investment destination, including for real estate properties.
- From this year, Switzerland’s Federal Council, the country’s top governing body, has decided to implement a key recommendation of the Global Forum on Transparency and Exchange of Information for Tax Purposes, under which Swiss authorities will also share details about investments made by foreigners in the Swiss real estate sector. However, some other recommendations of the Global Forum, including about sharing of information on digital currency accounts and contributions made to foundations and non-profit organisations are yet to be accepted and therefore those details would not be shared by Switzerland with India or any other countries for now. Hectic lobbying is underway globally to convince Switzerland to start sharing information about digital currency accounts and contributions made to non-profit entities as well.
- In each of the last two years, Switzerland has shared details about nearly three million financial accounts with various jurisdictions, while the count is expected to be higher this year. For the last two years, India has been among prominent countries with which Switzerland has shared details about financial accounts of clients of Swiss banks and various other financial institutions, while it is also expected to figure high this year with regard to details about real estate properties.
- India had received the first set of details from Switzerland under AEOI (Automatic Exchange of Information) in September 2019. It was among 75 countries to get such information that year. In September 2020, India received the second set of Swiss bank account details of its nationals and entities, along with 85 other recipient countries with whom Switzerland’s Federal Tax Administration (FTA) exchanged information on financial accounts within the framework of global standards on AEOI last year.