Liechtenstein:
As pressure mounts on the Indian government to crack down on black money, Liechtenstein has said that it has already been helping India.
Tucked away between Austria and Switzerland, in the mountains, the tiny municipality of Liechtenstein was considered one of the most uncooperative tax havens in the world. But giving in to the international pressure, it agreed in 2009 to sign tax treaties which would allow countries to trace their black money in Liechtenstein accounts.
Even the Opposition in Liechtenstein's 24-member Parliament that had been fighting for shift in policy says things have changed now. But now they say the onus is on India to negotiate a tax treaty quickly.
"We have done our job in Liechtenstein, we have changed the laws. Now the Indians have to come and solve their problem," said Dr Pepo Frick, MP, Liechtenstein Opposition.
The Indian government has said that it has initiated the process of negotiating treaties with more than 65 countries. But experts say India will still face problems getting information as these treaties are not based on the European model which allows for more automatic exchange of information. These treaties will instead ask India to give details such as names, account numbers and bank names beforehand which are extremely hard to get. Such a condition will create a huge leeway for tax havens to simply not cooperate even if tax treaties are signed.
"Bilateral treaties tend to be negotiated under the OECD standard which is a very weak standard indeed. So when you see agreements like this being signed, it's a very incremental step, it's better than nothing but it's very small and very limited," said Nicholas Shaxton, Adivsor, Tax Justice Network.
India is yet to start negotiating a treaty with Liechtenstein, but whether scores of other treaties that it is negotiating with the country will lead to easier access to information and the black money coming back to the country, is yet to be seen.
Tucked away between Austria and Switzerland, in the mountains, the tiny municipality of Liechtenstein was considered one of the most uncooperative tax havens in the world. But giving in to the international pressure, it agreed in 2009 to sign tax treaties which would allow countries to trace their black money in Liechtenstein accounts.
Even the Opposition in Liechtenstein's 24-member Parliament that had been fighting for shift in policy says things have changed now. But now they say the onus is on India to negotiate a tax treaty quickly.
"We have done our job in Liechtenstein, we have changed the laws. Now the Indians have to come and solve their problem," said Dr Pepo Frick, MP, Liechtenstein Opposition.
The Indian government has said that it has initiated the process of negotiating treaties with more than 65 countries. But experts say India will still face problems getting information as these treaties are not based on the European model which allows for more automatic exchange of information. These treaties will instead ask India to give details such as names, account numbers and bank names beforehand which are extremely hard to get. Such a condition will create a huge leeway for tax havens to simply not cooperate even if tax treaties are signed.
"Bilateral treaties tend to be negotiated under the OECD standard which is a very weak standard indeed. So when you see agreements like this being signed, it's a very incremental step, it's better than nothing but it's very small and very limited," said Nicholas Shaxton, Adivsor, Tax Justice Network.
India is yet to start negotiating a treaty with Liechtenstein, but whether scores of other treaties that it is negotiating with the country will lead to easier access to information and the black money coming back to the country, is yet to be seen.
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