G20 endorses India's concerns on black money

Brisbane: Endorsing India's concerns about black money and tax avoidance, G20 leaders Sunday promised to modernise international tax rules.

In a joint communique issued at the conclusion of the summit, the leaders said: “We welcome the significant progress on the G20/OECD (Organisation of Economic Cooperation and Development) Base Erosion and Profit Shifting (BEPS) Action Plan to modernise international tax rules. We are committed to finalising this work in 2015, including transparency of taxpayer-specific rulings found to constitute harmful tax practices.”

The communique stated that to prevent cross-border tax evasion, “we endorse the global Common Reporting Standard for the automatic exchange of tax information (AEOI) on a reciprocal basis”.

“We will begin to exchange information automatically with each other and with other countries by 2017 or end-2018, subject to completing necessary legislative procedures,” it stated.

Earlier Sunday, Indian Prime Minister Narendra Modi made a strong pitch at the G20 summit for repatriation of black money by stressing on the need for close coordination to address the challenge of black money, and linked it to security issues such as terrorism, a major global concern.

Addressing a G20 session titled "Delivering Global Economic Resilience", the prime minister voiced support for a new global automatic exchange of information, saying it would be instrumental in getting information of the unaccounted money stashed abroad and help bring it back.

Making an intervention on issues of tax evasion on the second and final day at the G20 Summit, the prime minister "reiterated his call for close policy coordination among major economies, saying this is important not just for addressing the challenge of black money, but also for security issues like terrorism, drug trafficking, arms smuggling etc.", according to an official statement.

Following the issuance of the communique, the Prime Minister's Office tweeted: “India's concerns on Black Money & Tax Avoidance have found an echo & have been taken on board the final G-20 communique.”

It also tweeted about the communique's reference to the BEPS action plan and transparency in taxpayer specific rulings constituting harmful tax practices.

“India scores at G-20,” Syed Akbaruddin, spokesperson of the ministry of external affairs, tweeted. “PM @narendramodi strong intervention gets backing for inclusion in tax matters in final communique.”