Investigators in India might have their best chance yet to trace those Indians who have stashed away millions in the tiny tax haven of Liechtenstein, a small landlocked country between Austria and Switzerland, provided the Manmohan Singh government asks for the information on offer.
The dope on hundreds of rich Indians who have black money parked in Liechtenstein could be made available to the authorities here as the German government, which has obtained a list of account holders at Liechtenstein’s LTG Bank, is willing to part with the names.
Several countries including the US, the UK, Canada, Italy, Norway, Sweden, Finland and Ireland have already used the opportunity to zero in on their citizens who have evaded taxes and smuggled their wealth to the principality, the sixth-smallest country in the world. But Transparency International says India has maintained 'a stoic silence over the issue and has not approached the German government for this data'.
Expressing concern over the Indian government's apparently lackadaisical attitude in getting after offenders who have cheated the tax authorities of millions of dollars is quite surprising and the Indian chapter of TI - an organization campaigning to reduce corruption - has urged the government to take all necessary steps to seek the data.
Admiral R H Tahiliani, chairman if TI India and a former navy chief, said: ‘‘This money belongs to the people of India and it is possible that it has been tucked away in this distant country by those who have acquired it illegally and are now evading taxes.
"There should be complete transparency and accountability about this money and it is for the government to find this out and inform people," Admiral Tahiliani, said, referring to the black money stashed away abroad.
Indeed, the offer looks too good to refuse. It is a bit like being served secrets on a platter and if the government does not waste time looking a gift horse in the mouth, it could get data that might otherwise never be accessed given the laws that protect tax havens that often require specific proof of criminality.
In fact, the dice is invariably loaded against investigators - for example the Hindujas were able to delay proceedings in the Bofors case by challenging each application filed by CBI.
Suspecting that the government's chariness could stem from fears that influential politicians and industrialists might be compromised by the Liechenstein data, TI has, in a statement, said: "It is alleged that this money belongs to rich and powerful politicians, industrialists and stock brokers and that is why the reluctance on the part of government of India (to get details from Germany)."
Liechtenstein, like Switzerland, St Kitts, Canary Islands, Antigua and Bahamas, has been a haven for wealthy people to hide their ill-gotten wealth away from the prying eyes of tax authorities. Referring to reports, TI mentioned that German intelligence agency - BND - has details of about 800 clients of LTG Bank - run by Liechtenstein’s ruling dynasty - and prosecutors are using this information to target suspected tax evaders.
"The ministry of finance and PMO have, however, not shown much interest in finding out about those who have their lockers on the secret banks of Liechtenstein which prides itself in its banking system," TI said.
Referring to such banking systems, TI also said that secretive and non-transparent tax havens could be used for money that is related to drugs and terrorism. These accounts have been frequently used to channel money for purchase of arms.
Sources:Times of India