Currently, there is a wave and trend towards black money fighting. In India we have the Undisclosed Foreign Income and Assets Act 2015 which gives prosecution and imprisonment to holders of black money. Similarly, there are a number of laws by different countries enacted in the last few years that aims to counter black money.
The US, Germany, UK etc have passed laws to ensure tax information about their citizens and residents in foreign countries. Similarly, many countries have launched schemes like India’s black money law to give a last chance to black income holders to declare their black income abroad and to come clean. All these shows something big is going to happen. A global war on black money and tax avoidance is taking place on many fronts. DTAAs are strengthened with Tax Information Exchange Agreements. Similarly, banking secrecy laws in Switzerland will be phased out.
Governments and organizations like OECD and G20 are in the forefront of the new and successful fight against black money. They have created an organization called Global Forum on Transparency and Exchange of Information for Tax Purposes to design mechanisms and arrangements that can be implemented globally to track black money. The new war against black money is not national rather, it is international. Once countries start automatic exchange of bulk information on income and tax paid by residents from other countries, it is going to be difficult to store black income in foreign countries.
Global Forum on Transparency and Exchange of Information for Tax Purposes
The Global Forum on Transparency and Exchange of Information for Tax Purposes (Global Forum) is a multilateral framework which works in the area of transparency and exchange of information for tax purposes.
The Global Forum was originally established in 2001 by OECD member countries along with a number of participating partners. The Forum has been a driving force behind the development of the international standard of transparency and exchange of information for tax purposes.