Automatic Exchange of Information

India has received the fourth set of Swiss bank account details of its nationals and organisations as part of an annual information exchange, under which Switzerland has shared particulars of nearly 34 lakh financial accounts with 101 countries.

Details –

• This is the fourth tranche of information that India has received from Switzerland since the two countries entered into an Automatic Exchange Of Information (AEOI) agreement in January 2018.
• The first such exchange with India took place in 2019.

About the ‘Automatic Exchange of Information’ –

• AEOI 2022 exchange exercise aims to bring in transparency and restrict money laundering.
• Some countries which have been added to the Swiss AEOI list for the first time are Turkey, Peru and Nigeria.
• The guidelines and parameters for the AEOI are set by the Paris-based international body, the Organisation for Economic Co-operation and Development (OECD).
• The annual exercise of AEOI exchange, such as the current Swiss bonanza of banking details, is strictly meant for “tax only” purposes and in India, kept in the custody of and for action by the Central Board of Direct Taxes (CBDT).
• Under the OECD’s guidelines, no details of the quantum of funds or the names of account holders are to be publicised.
• In 2014, the OECD developed the Common Reporting Standard (CRS) which allows every country to obtain data from Financial Institutions (FIs) and “automatically” exchange it with countries with which AEOI agreements are in order every year.
• Under the OECD umbrella of AEOI, India presently shares bulk financial and banking information with 78 countries and receives the same from 107 countries.