Government approves pact with Seychelles to curb black money

NEW DELHI: The cabinet approved the ratification of an agreement between India and the Seychelles for exchange of information on taxes, which is expected to help in the fight against unaccounted wealth.

“This is part of the ongoing initiative of the government of India to unearth black money,” communications and information technology minister Ravi Shankar Prasad said after the cabinet meeting.

Any unauthorised transaction, “regardless of the fact that (the person) is resident or not,” will be liable for prosecution, the minister said, adding that all taxes are covered.

India has put in place similar bilateral agreements for exchange of tax Information with Argentina, the Bahamas, Bahrain, Belize, Bermuda, British Virgin Islands, Cayman Islands, Gibraltar, Guernsey, Isle of Man, Jersey, Liberia, Liechtenstein, Macao, Monaco and San Marino.

A global regime of information exchange will go into force in 2017, arming governments with data to deal with illicit wealth.

The agreement with the Seychelles also provides for a mutual agreement procedure to resolve any procedural differences. Information received under the agreement can be disclosed to any other person or entity with prior written consent of the country sending such information.

Prasad said the government has taken other similar initiatives, including signing of the Foreign Account Tax Compliance Act with the US and the enactment of a black money law.