India to sign an agreement for Foreign Account Tax Compliance Act
Indian government is likely to sign a pact for the United States tax compliance law Foreign Account Tax Compliance Act, in July 2015. An official statement in this regard was made by Akhilesh Ranjan, a Joint Secretary in Ministry of Finance, Government of India. “Indian government is likely to sign the Intergovernmental Agreement (IGA) for FATCA in early July 2015,” said Akhilesh Ranjan, Joint Secretary (Foreign Tax and Tax Research Division), Ministry of Finance, on Thursday. The Finance Ministry official was speaking at the round-table discussion on ‘Implementation of FATCA norms in India’ organised by Federation of Indian Chamber of Commerce and Industry (FICCI) in New Delhi. FATCA compliance will necessarily have to cover all new accounts opened by Indian Financial Institutions (FIs) from July 1, 2014 onwards. Further, FIs would be obliged to share data with the government in respect of all new accounts opened from July 1 till December 31, 2014, to enable the government to share this data with US by September 30, 2015, informed the FICCI in its official release. Speaking further on the matter, Akhilesh Rajan assured that government is committed to the cause of confidentiality of data and is taking several measures in that direction. And, a security committee has also been set up within Central Board of Direct Taxes (CBDT) headed by Chief Information Security Officer for security of documents and information. Internal systems are being devised so that the distribution of information is channelized and there is no general distribution of information, he informed. Speaking on the occasion earlier, Sunil Sanghai, Chairman, FICCI’s Capital Markets Committee and Managing Director, Head of Global Banking - India, HSBC, highlighted that FIs are anxious to know the timeline, operating guidelines and the framework for FATCA implementation in India. With an objective of reporting foreign financial assets and withholding the cost of non-reporting, the FATCA mainly targets tax non-compliance by US taxpayers with foreign accounts. It focuses on reporting by US taxpayers over certain foreign financial accounts and offshore assets and reporting by foreign financial institutions about financial accounts held by US taxpayers or foreign entities in which US taxpayers hold a substantial ownership interest.
June 27, 2015 | 6:22 pm IST.
-Vertical.jpg)
to success.