India has ratified an international convention on taxation which will help the country in bringing back illegal funds stashed abroad, the finance ministry said today.
India became the 13th country and the first non-OECD nation to ratify the 'Multilateral Convention on Mutual Administrative Assistance in Tax Matters', which seeks to promote transparency and exchange of tax-related information.
The Convention, a ministry release said, "also provides for assistance in the recovery of taxes. This will give a fillip to the efforts of the government in bringing the Indian money illegally stashed abroad".
It will also allow India to seek past information in criminal tax matters.
"A Party to the Convention is compulsorily required to Exchange the past information in criminal matters for at least three years...," the release said.
The convention, it said, explicitly provides for automatic and spontaneous exchange of information and will permit tax officials to enter into the territory of the other country to examine individuals and records.
More From This Section
India has ratified the convention by depositing the Instruments of Ratification on February 21. Out of the 34 countries which have signed the convention, only 13 have ratified it so far.
The other countries who have ratified the convention include France, Italy, Norway, Sweden and United Kingdom. The important nations which are yet to ratify it include Australia, Germany, Japan, Russia and the US.