G-20 asks nations to share information to curb tax evasion

Cannes, Nov 5 (PTI) In a major gain for India, the G-20 Summit has asked tax havens to adopt prudential norms for sharing of tax information to check money laundering and funding of terror failing which it threatened action. The Communique issued Friday at the end of the 2-day meeting of the Summit, attended among others by US President Barack Obama and host President Nicolas Sarkozy, also warned of action against jurisdictions and entities that will not cooperate in ensuring transparency in tax frauds. "We underline the importance of comprehensive tax information exchange and encourage work in the Global Forum (of OECD) to define the means to improve it," the Communique said. It called upon the nations to "adhere to the international standards in the tax, prudential and Anti Money Laundering/ Combating the Financing of Terrorism (AML/CFT) areas". It also warned of its readiness to use its "existing counter measures" if they fail to enforce transparency measures. Prime Minister Manmohan Singh, who attended the Summit of 20 powerful economies, hailed the Communique saying it endorses India's call for increased banking transparency and exchange of information to combat tax fraud and evasion and other illicit flows. "This was an important part of our agenda." The Communique's stand on the issue assumes significance in the context of a raging debate in India on the black money stashed abroad and the government's attempts to bring it back from the tax havens. "We welcome the commitment made by all of us to sign the Multilateral Convention Mutual Administrative Assistance in Tax Matters and strongly encourage other jurisdictions to join this convention," the Communique said. Prime Minister Singh had said that tax evasion and illicit flows have seen the migration of tax bases in developing countries and are serious problems. "The G-20 should send a strong message to curb such activity," he had said. The leaders of the G-20 also reaffirmed their commitment to combat the menace of corruption and to providing a clean business environment. "We have made significant progress in implementing the Action Plan on combating corruption, promoting market integrity and supporting a clean business environment," the Communique said. "We underline the need for swift implementation of a strong international legislative framework, the adoption of national measures to prevent and combat corruption and foreign bribery, the strengthening of international cooperation in fighting corruption and the development of joint initiatives between the public and the private sector," it added. PTI Caption for pic: French President Nicolas Sarkozy with G-20 members' Finance Ministers during the Presentation ceremony Convention on Fighting Tax Evasion at the G-20 summit in the Palais des Festivals, at Cannes, France on Friday. PTI Photo