PTI reported today that industrialist Yash Birla, along with four other lesser known businessmen hold Swiss bank accounts as confirmed by the Switzerland authorities.
This news apparently delighted the finance minister who chalked this to successful diplomacy and cooperation between the Modi government and the Swiss government.
Almost all news articles I read talked about Yash Birla as if he were guilty already, and I was unsure as to what the charges were.
It seemed at first that holding a Swiss account that wasn’t disclosed to the Indian IT authorities is what these individuals did wrong, but if that were the case then I wasn’t sure why the Swiss decided to release these five names only. Surely, a lot more than five Indians hold Swiss accounts. Also interesting is the timing of the release because the Indian government does complete a year today, and this timing is rather perfect for them.
Deutsche Welle which is an international German newspaper also reported the story, and had a little more breadth to their reporting because of the international angle that the Indian papers lacked.
Switzerland has begun online publication of names of foreigners and foreign firms wanted in tax probes by their countries of origin, including Germany. American citizens are identified only by their initials.
So, from this piece of information you can gleam out that the reason why these names are published is that the Indian authorities have specifically asked for certain individual names from the Swiss stating that the Indian government is investigating these individuals for tax frauds.
The second big question is why the Indian government asked about some individuals specifically, and the article refers to names from the stolen list that became popular some time ago.
So, to that effect these names were present in a list of people who used to have Swiss accounts at one point in time, and now that the Swiss Authorities have confirmed that these people did in fact have Swiss Accounts at one point or the other — I imagine the Indian authorities will encourage these individuals to voluntary declare their incomes under the new Black Money Act and pay the fines per the new regulations.
I assume that Indian authorities will do that because there is still a very long way to go for India to actually get any details of how much money is there in these Swiss accounts or in fact if there is any money at all present there.
Would the people named in the stolen list have done nothing during this time?
And if there is no balance there presently, will the Swiss be willing to share where that money went? I wouldn’t bet my money on that.
I would like to see how this progresses and in fact if the IT department is able to do anything with just this confirmation since it doesn’t actually tell you the amount of money in the account, and I can’t imagine much being done without that information.
Also, if you haven’t read about this at all yet, this is a good article that will catch you up with the parts I assumed you have read already.
Update: An official spokesperson of Yash Birla Group has said that Yash Birla has no individual bank account in his name or in his control.
9 thoughts on “Yash Birla has a Swiss Account, what next?”
The government has launched one-time 90-day compliance window being provided to foreign asset holders to come clean. It will give immunity from prosecution under FEMA, Prevention of Money Laundering Act and four other laws to persons declaring undisclosed foreign assets.
My question is from a common man’s perspective, since it is so common for working professionals to travel overseas and hold bank accounts. Many people who travel back and forth on company assignments or business, prefer to keep their overseas accounts open. If the source of overseas funds is legal and paid overseas taxes, then, is the non disclosure itself a problem?
Tiny % of Indians pay taxes now. It is better to focus on reforming our tax system, widen tax base and reduce extravagance/corruption when spending taxpayer’s money. As an unenthusiastic taxpayer, it hurts to see bogus populist schemes (especially by state govts).
I think running after ‘Swiss/black money’ is a fruitless exercise- what’s evaded is gone. In the end, harmless middle-class people will get harassed with this aggressive taxation policies. Why would a Big Fish get caught, he would have layered his deposits and made bank account through proxies in Europe.
Those are exactly my thoughts, and I was thinking about this yesterday that when only 3% of the population actually pays taxes, it is much better to focus on increasing this number but then it is not as glamorous and won’t make for good news headlines etc. if they do that. Talking about black money will get a lot more attention even if it doesn’t get any actual money back!
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The black money investigations are announced so publicly I cant see anything coming out. I am sure the real culprits would have had enough advance notice to move their accounts and do whatever is necessary to evade authorities by now.
In fact they have already said that he doesn’t have any Swiss accounts. I wonder if this means that he never had them, which I find hard to believe since this is a communication coming directly from the authorities or more likely is the fact that he once had the account and has since then closed it. I see very very slim chances of any money coming back to India on account of these things.
It might be a deterrent to others in the future, but can’t see any money actually coming back.