FinMin refutes reports of alleged black money held by Indians in Switzerland

There have been certain reports appeared in the media that funds of Indians in Swiss Banks riises to over Rs 20,700 crore (CHF 2.55 billion) in 2020 from Rs 6,625 crore (CHF 899 million) in 2019, reversing a 2-year declining trend.

Jun 21, 2021 11:06 IST India Infoline News Service

The Finance Ministry has clarified various media reports that have claimed that funds of Indians in the Swiss Bank has witnessed a steep rise in 2020. The ministry refutes news media reports of alleged black money held by Indians in Switzerland.

There have been certain reports that appeared in the media on 18.06.2021 stating that funds of Indians in Swiss Banks have risen to over Rs 20,700 crore (CHF 2.55 billion) at the end of 2020 from Rs 6,625 crore (CHF 899 million) at the end of 2019, reversing a 2-year declining trend. It has also been stated that this is also the highest figure of deposits in the last 13 years.

FinMin in a statement said, "Media reports allude to the fact that the figures reported are official figures reported by banks to Swiss National Bank (SNB) and do not indicate the quantum of much-debated alleged black money held by Indians in Switzerland. Further, these statistics do not include the money that Indians, NRIs or others might have in Swiss banks in the names of third-country entities."

However, the ministry also highlighted that the customer deposits have fallen since the end of 2019. The funds held through fiduciaries has also more than halved from the end of 2019. The biggest increase is in “Other amounts due from customers”. These are in form of bonds, securities and various other financial instruments.

"It is pertinent to point out that India and Switzerland are signatories to the Multilateral Convention on Mutual Administrative Assistance in Tax Matters (MAAC) and both countries have also signed the Multilateral Competent Authority Agreement (MCAA) according to which, the Automatic Exchange of Information (AEOI) is activated between the two countries for sharing of financial account information annually for the calendar year 2018 onwards," FinMin added.

It needs to be noted that Exchanges of Financial Account information in respect of residents of each country have taken place between both countries in 2019 as well as 2020.

The ministry stated that given the existing legal arrangement for the exchange of information of financial accounts (which has a significant deterrent effect on tax evasion through undisclosed assets abroad), there does not appear to be any significant possibility of the increase of deposits in the Swiss banks which is out of undeclared incomes of Indian residents.

Further, FinMin said that the Swiss Authorities have been requested to provide the relevant facts along with their view on possible reasons for the increase/decrease in the light of the media reports highlighted above.

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