Union Cabinet on Wednesday approved an agreement between India and Saint Vincent and The Grenadines for the exchange of information and assistance in collection of tax claims, the government said in an official statement.
The agreement will help in facilitating the exchange of information between the two countries including sharing of information held by banks and other financial institutions regarding the legal and beneficial ownership. It will also facilitate the assistance in collection of the tax claims between the two countries, the statement said.
The agreement will strengthen India’s fight against offshore tax evasion and tax avoidance practices leading to generation of unaccounted black money.
The agreement also contains provisions for tax examination abroad which allow the representatives of the other country to enter its territory, to the extent permitted under its domestic laws, to interview individuals and examine records for tax purposes, according to the statement.
This is a new agreement between India and Saint Vincent and The Grenadines. There was no such agreement in the past between the two countries.
A senior official told Indian Narrative the agreement will help India check tax evasion as it will enable access to information about secret bank accounts of Indian citizens in the Caribbean nation.
Saint Vincent and the Grenadines is a small Caribbean tax haven that lies in the Lesser Antilles islands. As a tax haven in which offshore companies are founded, Saint Vincent is especially used for anonymity of ownership and high-tech offshore banking services.
There was no such agreement with Saint Vincent and The Grenadines in the past and India was negotiating this agreement for a long time.