G-20 warns tax havens, India pledges support

RSTV Bureau
 Union Finance Minister Arun Jaitley with  Finance Minister of Sri Lanka ,  Ravi Karunanayake and Executive Director IMF Subir Gokarn at IMF 2016 Spring Summit in Washington DC. Photo-PTI

Union Finance Minister Arun Jaitley with Finance Minister of Sri Lanka , Ravi Karunanayake and Executive Director IMF Subir Gokarn at IMF 2016 Spring Summit in Washington DC.
Photo-PTI

Acting in the wake of the ‘Panama Papers’ scandal, the G20 economies, including India, Group of 20 largest economies have sent a warning Friday to tax havens like panama that are hiding billions of dollars of individuals from various countries.

In a meeting held on the sidelines of annual IMF meet Finance Ministers and Governors of Central Banks, the G20 sought a crackdown on tax heavens, shell companies and terror financing companies.

“The G20 reiterates the high priority it attaches to financial transparency and effective implementation of the standards on transparency by all, in particular with regard to the beneficial ownership of legal persons and legal arrangements,” the G20 communique said.

Seeking a crackdown on terror financing, the G20 Finance Ministers called on all countries to join its efforts including through swift and effective implementation of FATF standards, the new Consolidated Strategy on Combating Terrorist Financing and provisions of the UN Security Council Resolution 2253.

India is represented by Finance Minister Arun Jaitley and the Reserve Bank of India Governor Raghuram Rajan where it had conveyed a strict message to crackdown tax heavens.

In the communique, the G20 Finance Ministers reiterated that it is essential that all countries and jurisdictions fully implement the Financial Action Task Force (FATF) standards on transparency and beneficial ownership of legal persons and legal arrangements and expressed determination to lead by example in this regard.

“We particularly stress the importance of countries and jurisdictions improving the availability of beneficial ownership information to and its international exchange between, competent authorities for the purposes of tackling tax evasion, terrorist financing and money laundering,” the communique said.

The G20 forum has asked the Global Forum on Transparency and Exchange of Information for Tax Purposes to make initial proposals by our October this year to improve the implementation of the international standards on transparency, including on the availability of beneficial ownership information and its international exchange.

Few days back International consortium of investigative journalists have relapsed a series of papers under the title Panama Papers where it had brought out details of 500 Indians having opened up shell companies overseas allegedly to evade taxes with the help of a firm Mossac Fronseca.

Many countries like Spain, Russia, Pakistan and India have already started initial investigations on the names mentioned in the panama papers.