Switzerland now joins a league of other 58 nations who have inked the Multilateral Convention on Mutual Administrative Assistance in Tax Matters. The agreement was signed on the sidelines of the event at Paris-based Organization of Economic Cooperation and Development (OECD) With this agreement, the 300 years old banking secrecy associated with Switzerland is now put to an end. Further, now the country will embark on cooperation with other nations on taxation matters. As a result, nations including India will have access to information on black money stashed away in Switzerland.

Switzerland signed the Convention on the back of global pressures forcing the Swiss government to disclose information about account held in its bank to the overseas authorities. The bank accounts in the country deemed as safe havens by tax evaders.

As part of the Multilateral Convention mutual assistance in terms of exchange of information on request, tax assessment in foreign nation with simultaneous tax assessment and assistance with respect to tax collection will be offered. All such provisions will also ensure that taxpayers' rights are well protected. So, all nations seeking assistance in its respect require signing of a agreement and will then have option to exchange information on an automatic basis. Further, adherence to an instrument on the part of Switzerland will enable it be part of the jurisdiction that would decide on exchanging financial information an automatic basis.

Supporting the agreement, Ambassador to the OECD Stefan Flückiger was quoted in one of the media reports saying "Switzerland has been committed to complying with international standards in tax matters since March 2009. The signing of the Convention confirms Switzerland's commitment to the global fight against tax fraud and tax evasion with a view to safeguarding the integrity and reputation of the country's financial centre."

What the Multilateral Convention means for tax evaders?

The step by the Swiss government will put a curb on tax evasion on the part of foreign nationals who illegally concealed information on their wealth from their taxpayers. With this agreement in place, tax authorities of other nations will now be able to fully access Swiss banking details. So, tax-evaders who until now safeguarded their wealth or black money in Swiss banks to evade tax considering them to be safe will not be able to do so in due course.

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