I-T department issues internal guidance to officers in tax havens investigation

The Income Tax department of India has issued an internal guidance to its officers, directing them about seeking information from tax havens, especially the ones in British Virgin Islands (BVI).

In an internal communication sent to the officers, the revenue department said that this is being done so that when officers request the BVI authorities for information, they are provided with better results.

"In view of the investigations carried out in Panama Papers, IT Dept. foresees increased EOI (exchange of information) requests to BVI in the near future," said Rakesh Nangia, managing partner at Nangia & Co.

Also read: Seychelles: just another honeymoon destination or the next big tax haven?

As per sources, the guidance provides a background to the field officers about the entire procedure by which a company is incorporated in the BVI, as well as on the shareholding or directors of BVI companies. It also highlights that the details of shareholders of BVI company are not publicly available.

Mossack Fonseca, the Panama law firm leaked millions of documents showing Panama islands as a major tax haven, in which names of about 500 Indians also popped up.

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