The agreement aims to block US citizens attempts to
avoid tax through financial products like equities,
bank accounts and insurance. In return India
expects Washington’s support to bring back illicit
funds stashed by Indians in foreign tax havens.
At the agreement signing in Delhi revenue secretary
Shaktikanta Das said the agreement will enhance tax
transparency and bring in higher equity to the
direct tax regime which is necessary for a healthy
PM Narendra Modi has enacted a black money law that
foresees tough penalties and a jail term for tax
evaders who fail to declare their overseas incomes.
Last year Modi also joined leaders from the Group of
20 countries in Australia in an agreement for
countries to atomically exchange tax information on
a reciprocal basis by the end of 2018.