Finance Minister Pranab Mukherjee today favoured renegotiating tax treaties India has signed with many countries, saying that tax havens should be brought under “discipline”.
He said the Swiss authorities had decided earlier this year to share information with those countries which have accepted the Article 26 of the OECD (Organisation for Economic Cooperation and Development) convention.
Speaking to reporters, Mukherjee said the Swiss banks were following the old traditional bank secrecy laws. On the double taxation avoidance agreement (DTAA) with other countries, he said the ministry was studying the relevant clauses.
Mukherjee said “we are also pursuing amendment (DTAA) to the Mauritius treaty”.
The Article 26 of OECD model convention on double taxation deals with exchange of information and lays down that the competent authorities of the contracting states will exchange such information as is necessary for carrying out the provisions of the convention or the domestic laws concerning taxes of every kind and description imposed on behalf of the contracting states, or of their political subdivisions or local authorities.
The Article also says that the information will not be exchanged to carry out administrative measures at variance with the laws and administrative practice of that or of the other contracting state and which is not obtainable under the laws, or in the normal course of the administration.
