Economy

Tax havens harm national security: India

Expressing concerns over tax havens, the government on Wednesday said financial manipulations in these areas hit tax collections and can also be detrimental to security interests.

“The opaque system of exchange of information in the these tax havens and their non-compliant behaviour are matter of concern not only for revenue base but also linked to financing of activities, which are detrimental to the national security interests,” Finance Minister Pranab Mukherjee said at a CBDT seminar on transfer pricing here.

The Finance Minister’s comments came in even as India is in the process of revisiting its tax treaties with a number of countries, including tax havens like Switzerland.

A tax haven is a country which has secrecy of laws on taxes and very low or zero tax rates.

For a developing country like India, Mukherjee said the role of tax havens and low tax jurisdictions have become an area of great concern.

He also blamed these areas for augmenting the global financial meltdown.

“It is widely believed that the tax havens and low tax jurisdictions were important actors in the crisis,” he said.

He said agreements on transparency in tax matters were resisted in the past on the pretext of secrecy.

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Printable version | Feb 21, 2020 5:26:48 AM | https://www.thehindu.com/business/Economy/Tax-havens-harm-national-security-India/article16815144.ece

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