New ‚Äòtool box’ in India to counter opaque tax havens

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New ‚Äòtool box’ to counter opaque tax havens.

Good news from India:

In a significant move that will eventually help the government seek information from tax havens, the revenue department in the finance ministry has started the process of defining non-cooperative jurisdictions — countries that do not share any information about companies evading tax in India.

Government sources told The Indian Express that the finance ministry has formed a five-member committee for defining the characteristics of such a jurisdiction and then prepare a list of countries that would qualify as a non-cooperative jurisdiction. The committee would have to do a delicate balancing act as the issue is not only financial but also political, the sources said.

According to the sources, the committee will delve into the mechanism used by such jurisdictions for acting as tax havens and the reasons for non-existence of information exchange processes for tax purposes. “After collecting inputs, the department will develop a tool box to counter such activities,” a source said. It will also work on measures to be adopted by India in combating such jurisdictions, the sources said, adding that these would form a part of the proposed Direct Tax Code (DTC).

They might do well to look at the Tax Justice Network secrecyjurisdictions.com web site and the Financial Secrecy Index.

But what's really significant is countries are now showing willingness to move beyond the OECD's position - because the OECD's position is not good enough. And that's welcome news for all who want to stop abuse.