New Delhi/Fukuoka: Finance Minister Nirmala Sitharaman on Saturday highlighted the ongoing efforts of India to counter tax avoidance and evasion.
She was speaking at the Ministerial Symposium on International Taxation on Globally Fair, Sustainable and Modern International Taxation System organised during the meeting of G-20 Finance Ministers at Fukuoka in Japan. "@nsitharaman spoke on the on-going efforts of Indian Government to counter tax avoidance & evasion," the finance ministry tweeted.
The two-day G-20 Finance Ministers and Central Bank Governors meeting beginning on Saturday is likely to focus on risks and challenges being faced by the global economy, investment in infrastructure and international taxation. The deliberations would be followed by the G-20 Leaders' Summit scheduled on June 28-29 at Osaka.
The meeting of the finance ministers would also deliberate on issues like increasing protectionism and its implication on global growth and trade. On the sidelines of the G-20 meet, Sitharaman also held a bilateral meeting with her UK counterpart Philip Hammond.
The ministerial symposium was organised with the support of OECD to discuss the challenges in modernising the international tax system and also ways to continue the fight against tax avoidance and evasion.
India is a signatory to the OECD's multilateral convention that aims to check cross-border tax evasion by multinational companies. The Multilateral Convention is an outcome of the OECD/G20 Project to tackle Base Erosion and Profit Shifting (BEPS), which is resorted to by MNCs through tax planning strategies by exploiting gaps and mismatches in tax rules.
It helps them artificially shift profits to low or no-tax locations, resulting in little or no overall corporate tax being paid Post this convention, 90 countries have now implemented automatic exchange of financial account and tax information. Further, with increasing digitalisation, the challenge now before the G-20 and OECD countries is how to tax businesses which mostly rely on intangible assets, data and user participation.
Speaking at the ministerial symposium, Japan Deputy Prime Minister and Minister of Finance Taro Aso said, "Due to public frustration surrounding the lower effective tax rates faced by some digital companies in particular, several countries have decided to act unilaterally, by putting temporary measures in place.
Obviously, multilateralism is better than unilateralism; a common approach is always better than fragmentation." G-20, which is a group of developing and developed nations, includes India, the US, the UK, China, Russia, Saudi Arabia, Brazil, France and Australia, among others....