Endorsing India’s concerns about black money and tax avoidance, G20 leaders Sunday promised to modernise international tax rules.
Indian Prime Minister Narendra Modi had urged G20 nations to forge close coordination to battle black money and linked it to security issues such as terrorism.
Addressing a G20 session, “Delivering Global Economic Resilience”, Modi also voiced support for a new global automatic exchange of information, saying it would help unearth information about unaccounted money stashed abroad.
The Indian leader spoke on issues of tax evasion on the second and final day at the G20 Summit.
Modi “reiterated his call for close policy coordination among major economies, saying this is important not just for addressing the challenge of black money but also for security issues like terrorism, drug trafficking (and) arms smuggling”, according to an official statement.
“He said although all countries have domestic priorities, coordinated decisions would ‘help us all’ in the long run. He said the resilience of the global financial system will also depend on cyber security.”
Modi expressed India’s support for a new global standard on automatic exchange of information, which would be instrumental in getting information about unaccounted money hoarded abroad and enable its eventual repatriation.
He said he supported all initiatives to promote exchange of information and mutual assistance vis-a-vis tax policy and administration.
“Noting that increased mobility of capital and technology have created new opportunities for avoiding tax and profit shifting, the prime minister said he urged every jurisdiction, especially tax havens, to provide information for tax purposes in accordance with treaty obligations,” the statement said.
“Hope Base Erosion and Profit Shifting (BEPS) system would fully address concerns of developing and developed economies,” according to tweets by the ministry of external affairs.
“Resilience of our financial system will also depend on cyber security,” the prime minister added.
The G20 governments are expected to back a plan to stop terrorist groups from getting money by introducing tougher standards that would reveal the identities of individuals and companies channelling illegal funds.
On Saturday, Modi first raised the subject by urging BRICS – at an informal meeting – on the need for close coordination between countries to repatriate unaccounted wealth.
Modi told leaders of Brazil, Russia, China and South Africa here that unaccounted money abroad posed economic and security challenges and called for a digital hub to share information.
The prime minister had while leaving for Myanmar, Australia and Fiji said he will highlight the importance of global cooperation against black money at the G20.