Stupid To Presume That All Swiss Money Is Black: Arun Jaitley

Union minister Arun Jaitley debunked news reports on Friday that indicated a surge in black money owing to deposits by Indians in the banks of Switzerland, dubbing it a “shaky presumption” that all such accounts are out of tax-evaded money or that the Alpine nation continues to be a haven for illegal financial deals.

Tacitly accusing the Opposition Congress party among “certain circles” of carrying out “misinformed reaction” to augment notions that the NDA government’s steps against slush funds have yielded no results, he said those who participate in a public discourse “must understand these basic facts before expressing an opinion which may be ill-informed”.

The BJP leader’s note, published in his blog, appeared hours after Congress president Rahul Gandhi took at dig at Prime Minister Narendra Modi revealing a 50 per cent rise in deposits by Indians in Swizz banks when the Centre had simultaneously declared a war on black money and touted demonetisation as one weapon against the economic menace.

Countering the snub, Jaitley said though Switzerland had conventionally been a “reluctant state” in “financial disclosures”, it has of late been subjected to “a lot of international pressures” which left that country faced with the risk of being a ‘non-compliant’ State by the three-decade-old inter-governmental Financial Action Task Force that fights money laundering.  Switzerland “has, therefore, entered into several bilateral treaties for making disclosures to requesting States.  It has amended its domestic laws involving all disclosures and entered into a treaty even with India,” he noted, making it mandatory to ensure “real-time flow” of relevant information mandatory from January next year. 

“Any illegal depositor knows that it is a matter of months before his name becomes public and he will be subjected to the harsh penal provisions of the black money law in India,” said Jaitley, also a senior lawyer, adding that action awaits only those resident Indians who deposit money in illegitimate categories.

The 65-year-old minister, who holds the portfolios of finance and corporate affairs, said the Modi government strategy to increase tax base has been “multi-pronged”, where the November 2016 withdrawal of two major denominations of currency-notes led to “a lot of people” in possession of undeclared cash depositing them in the banking system. The step also enabled the authorities to identify “almost 18 lakh” persons as having made deposits disproportionate to their returned incomes.  

The use of technology helped the tax department significantly, he claimed, pointing out that most of the functioning of the Income-Tax Department was now online, which also helps “detect those who should be filing returns but are non-filers”. 

Maintaining that the year-old implementation of the goods and services tax has “had a significant impact even on direct taxes”, the minister said, “Those who have disclosed a business turnover for the GST now find it difficult not to disclose their net income for the purposes of income tax.” The “first big news” for the 2018-19 financial year is that the advance tax deposit during its first quarter “has seen a gross increase of 44 per cent in the personal income-tax category and 17 per cent in the corporate tax category, he added.