Chidambaram’s last shot: tells Swiss to ratify global pact on tax avoidance

India has asked Switzerland to speed up the ratification of the Organization for Economic Cooperation and Development (OECD) convention on automatic exchange of tax information.

''I would urge you and your (Swiss) government to ratify the multilateral convention on mutual administrative assistance in tax matters as early as possible,'' outgoing finance minister P Chidambaram wrote to to his Swiss counterpart Eveline Widmer-Schlumpf during his last days in office, according to a PTI report.

''Once you ratify the convention, I am confident that your government will abide by its obligation under the convention as well as under the declaration that your country signed on 6 May 2014,'' the letter added.

India and a large number of other countries, including Switzerland, have adopted a global declaration for automatic exchange of tax information under the auspices of OECD.

The adoption of the Declaration on Automatic Exchange of Information in Tax Matters recently is aimed at sharing of information on illicit funds stashed abroad.

Chidambaram in his letter to the Swiss head of the federal department of finance said that though Switzerland is a signatory to the convention it has yet to ratify it.

The declaration, he added, calls upon ''all countries to sign and ratify the multilateral convention''.

It recognizes that investments kept offshore by tax payers should not go untaxed and the cooperation between countries should be on automatic basis.

The Paris-based OECD sets the global tax standards and frames conventions against tax frauds, among others.

Meanwhile, moving closer towards doing away with banking secrecy practices, Switzerland has started the ground work for implementation of automatic exchange of information on tax matters.

Switzerland, known for strong banking secrecy rules, had agreed to proposed new standard for automatic exchange of tax information earlier this month.