Customer deposits held in Swiss banks not necessarily located in Switzerland: Swiss authorities tell government
NEW DELHI: The Swiss authorities have informed the Ministry of Finance that customer deposits held in Swiss banks are not necessarily located in Switzerland and also include deposits at their branches abroad, the minister said on Tuesday. State Finance, Pankaj Chaudhary.
According to the latest data from the Swiss National Bank (SNB), funds deposited by Indian individuals and companies in Swiss banks, including through branches and other financial institutions based in India, have peaked in 13 years of 2.55 billion Swiss francs (over Rs 20,700 crore) in 2020.
In response to a written question to Rajya Sabha, Chaudhary said with regard to recent media reports, Swiss authorities recently, among others, indicated that the SNB report provides a comprehensive picture of the Swiss banking sector and is based on the SNB’s annual banking report statistics.
Last month, the finance ministry asked Swiss authorities for details of the relevant facts as well as their views on possible reasons for the changes in funds parked by Indian persons and entities in 2020.
“For these statistics, reporting banks provide balance sheet data on their bank office entity as well as their overseas branches. In addition, the Swiss authorities have also indicated that customer deposits held with Swiss banks are not necessarily located in Switzerland. Thus, the SNB’s annual banking statistics should not be used to analyze deposits held in Switzerland by Indian residents, â€Chaudhary said.
Citing data from the SNB, PTI, on June 17, reported that funds deposited by Indian individuals and companies in Swiss banks, including through branches and other financial institutions based in India, have reached a 13-year high of 2.55 billion Swiss francs (over Rs 20,700 crore) in 2020 on a sharp increase in holdings through securities and similar instruments, although customer deposits have declined.
Following the report, the Ministry of Finance in a statement said that the Swiss authorities had been invited to provide the relevant facts as well as their views on the possible reasons.
An automatic exchange of tax information between Switzerland and India has been in effect since 2018.
As part of this, detailed financial information on all Indian residents with accounts with Swiss financial institutions since 2018 was first provided to the Indian tax authorities in September 2019 and should be tracked annually.
“India is proactively engaging with Switzerland to obtain information in relevant cases under the Double Taxation Avoidance Convention (DTAA) between India and Switzerland.
“In addition, India and Switzerland are signatories to the Multilateral Convention on Mutual Administrative Assistance in Tax Matters and the two countries have also signed the Multilateral Agreement between Competent Authorities under which the automatic exchange of information is enabled between the two countries for sharing financial account information under Common Reporting Standard (CRS) every year, â€Chaudhary said.
According to SNB data, the increase in aggregate funds of Indian customers with Swiss banks of 899 million Swiss francs (Rs 6,625 crore) at the end of 2019, reverses a two-year downward trend and carried the figure at 2.55 billion Swiss francs in 2020.
While funds classified as ‘client account deposits’ actually declined by CHF 550 million at the end of 2019 and those via trustees also fell by more than half from CHF 7.4 million, the money held via other banks increased sharply, from CHF 88 million during this period. .
In the written response, Chaudhary stated that the “Black Money (Undisclosed Foreign Income and Assets) and Tax Imposition Act, 2015†was enacted with effect from July 1, 2015 to specifically and more effectively the problem of hidden black money. abroad.
In the past three fiscal years, 166 valuation orders have been passed, a claim for Rs 8,216 crore has been raised, and prosecutions have been initiated in 104 cases under the law.
According to the latest data from the Swiss National Bank (SNB), funds deposited by Indian individuals and companies in Swiss banks, including through branches and other financial institutions based in India, have peaked in 13 years of 2.55 billion Swiss francs (over Rs 20,700 crore) in 2020.
In response to a written question to Rajya Sabha, Chaudhary said with regard to recent media reports, Swiss authorities recently, among others, indicated that the SNB report provides a comprehensive picture of the Swiss banking sector and is based on the SNB’s annual banking report statistics.
Last month, the finance ministry asked Swiss authorities for details of the relevant facts as well as their views on possible reasons for the changes in funds parked by Indian persons and entities in 2020.
“For these statistics, reporting banks provide balance sheet data on their bank office entity as well as their overseas branches. In addition, the Swiss authorities have also indicated that customer deposits held with Swiss banks are not necessarily located in Switzerland. Thus, the SNB’s annual banking statistics should not be used to analyze deposits held in Switzerland by Indian residents, â€Chaudhary said.
Citing data from the SNB, PTI, on June 17, reported that funds deposited by Indian individuals and companies in Swiss banks, including through branches and other financial institutions based in India, have reached a 13-year high of 2.55 billion Swiss francs (over Rs 20,700 crore) in 2020 on a sharp increase in holdings through securities and similar instruments, although customer deposits have declined.
Following the report, the Ministry of Finance in a statement said that the Swiss authorities had been invited to provide the relevant facts as well as their views on the possible reasons.
An automatic exchange of tax information between Switzerland and India has been in effect since 2018.
As part of this, detailed financial information on all Indian residents with accounts with Swiss financial institutions since 2018 was first provided to the Indian tax authorities in September 2019 and should be tracked annually.
“India is proactively engaging with Switzerland to obtain information in relevant cases under the Double Taxation Avoidance Convention (DTAA) between India and Switzerland.
“In addition, India and Switzerland are signatories to the Multilateral Convention on Mutual Administrative Assistance in Tax Matters and the two countries have also signed the Multilateral Agreement between Competent Authorities under which the automatic exchange of information is enabled between the two countries for sharing financial account information under Common Reporting Standard (CRS) every year, â€Chaudhary said.
According to SNB data, the increase in aggregate funds of Indian customers with Swiss banks of 899 million Swiss francs (Rs 6,625 crore) at the end of 2019, reverses a two-year downward trend and carried the figure at 2.55 billion Swiss francs in 2020.
While funds classified as ‘client account deposits’ actually declined by CHF 550 million at the end of 2019 and those via trustees also fell by more than half from CHF 7.4 million, the money held via other banks increased sharply, from CHF 88 million during this period. .
In the written response, Chaudhary stated that the “Black Money (Undisclosed Foreign Income and Assets) and Tax Imposition Act, 2015†was enacted with effect from July 1, 2015 to specifically and more effectively the problem of hidden black money. abroad.
In the past three fiscal years, 166 valuation orders have been passed, a claim for Rs 8,216 crore has been raised, and prosecutions have been initiated in 104 cases under the law.
