Switzerland’s largest political party, the Swiss People’s Party, has stated that “corrupt and authoritarian countries” should not be given access to tax data. The proposed move could jeopardize Switzerland’s Automatic Information Exchange (AIE) treaty that was signed with India and ten other countries.
Once implemented, the treaty would have allowed tax authorities in countries like India to access bank data collected by Swiss authorities. This would allow the government to fight tax evasion and money laundering.
However, the Swiss People’s Party views India as a “corrupt country” and believes that sharing data with corrupt nations will allow corrupt tax officials to misuse the data to threaten and extort clients with accounts in Swiss banks.
If followed through, the plan could deal a significant blow to PM Modi’s fight against black money that has seen his government undertake contentious programs such as Demonetization in an effort to curb the practice of tax evasion.