In an attempt to reach out to financial institutions and account holders, the Central Board of Direct Taxes has created an exchange of information portal on the income tax department website for the dissemination of information to all stakeholders.
The Chairman of the CBDT, P.C. Mody, inaugurated the web portal earlier this week.
According to a press release, the India income tax information portal consolidates all Automatic Exchange of Information (AEOI)-related data in one place for convenient access by financial institutions, departmental officers, and the general public.
India committed to exchange financial account information automatically in 2017 under the Common Reporting Standard (CRS) on AEOI.
The CRS was developed in response to a G20 request and approved in July 2014. According to the Organisation for Economic Co-operation and Development, it calls on jurisdictions to obtain information from their financial institutions and report this to their tax authorities annually.
The reporting is done for a range of financial products, by several financial institutions, including banks, depository institutions, collective investment vehicles, and insurance companies.
The web portal will also be a repository of policy and technical circulars, guidance, and notifications issued by the CBDT.
It will provide links to relevant circulars issued by the regulatory authorities in India and other international bodies. The portal will not only be useful for domestic financial institutions but will also help foreign tax authorities and financial institutions get hold of information about Indian laws, rules, and procedures related to AEOI under CRS.
To implement the AEOI standard, a necessary domestic legal framework was put in place in 2015. A comprehensive guidance note was released on 31 August 2015 to guide the financial institutions, sectoral regulators, and officers of the income tax department to ensure compliance with the reporting requirements under the Income-tax Act and Rules.
The sectoral regulators have also issued necessary notifications and circulars for compliance by the financial institutions. Stakeholder consultations are also carried out by CBDT to educate financial institutions about their reporting obligations.
The government’s comprehensive note said that India would work under the CRS to combat the problem of offshore tax evasion and avoidance and stashing of unaccounted money abroad.
India also joined the Multilateral Competent Authority Agreement (MCAA) in 2015 to exchange information. By August 2015, 93 jurisdictions had committed to exchange information as per the new global standards, 58 of them from 2017 and the balance 35 from 2018. 61 of the 93 jurisdictions also joined the MCAA.
CBDT is a part of the Department of Revenue in the Ministry of Finance. CBDT provides essential inputs for policy and planning of direct taxes in India and is also responsible for the administration of direct tax laws through the income tax department.