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बेसिक इंग्लिश का दूसरा सत्र (कक्षा प्रारंभ : 22 अक्तूबर, शाम 3:30 से 5:30)
India-USA Sign FATCA
Jul 24, 2015

India and the US recently signed an Inter Governmental Agreement (IGA) to implement the Foreign Account Tax Compliance Act (FATCA) to promote transparency between the two nations on tax matters. The agreement underscores growing international co-operation to end tax evasion everywhere.  

  • Signing the IGA with U.S. to implement FATCA is a very important step for India to tackle offshore tax evasion.

  • It reaffirms India’s commitment to fight the menace of black money. 

  • The exchange of information on automatic basis, regarding offshore accounts under FATCA would deter tax offenders, would enhance tax transparency and eventually bring in higher equity in to the direct tax regime which necessary for a healthy economy.

  • FATCA is an important part of the U.S. Government’s effort to address that issue.

  • FATCA is rapidly becoming the global standard in the effort to curtail offshore tax evasion. To date, the United States has IGAs with more than 110 jurisdictions and is engaged in related discussions with many other jurisdictions. 

  • The United States enacted FATCA in 2010 to obtain information on accounts held by U.S. taxpayers in other countries. 

  • It requires U.S. financial institutions to withhold a portion of payments made to foreign financial institutions (FFIs) who do not agree to identify and report information on U.S. account holders.

  • As per the IGA, FFIs in India will be required to report tax information about U.S. account holders directly to the Indian Government which will, in turn, relay that information to the IRS. 

  • The IRS will provide similar information about Indian account holders in the United States. 

  • This automatic exchange of information is scheduled to begin on 30th September, 2015. 

Both the signing of the IGA with U.S. as well as India’s decision to join the Multilateral Competent Authority Agreement (MCAA) on 3rd June, 2015 are two important milestones in India’s fight against the menace of black money as it would enable the Indian tax authorities to receive financial account information of Indians from foreign countries on an automatic basis.  

The United States (U.S.) and India have a long standing and close relationship. This friendship extends to mutual assistance in tax matters and includes a desire to improve international tax compliance. The signing of IGA is a re-affirmation of the shared commitment of India and USA towards tax transparency and the fight against offshore tax evasion and avoidance. 

 

 


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