RBI to deal with tax haven menace

The Reserve Bank on Tuesday said it would deal with the problem of black money being hidden in tax havens by continuously updating its regulations in line with the G-20 guidelines on strengthening transparency in cross-border movement of capital.

"The Reserve Bank would continue to incorporate in its regulations latest international best practices (to deal with tax havens and non-cooperative jurisdictions)," the central bank said in its response to the recommendations of the G-20 Working Group on Enhancing Sound Regulation and Strengthening Transparency.

The working group of G-20 nations, which include developed and developing countries, underlined the need for increased disclosure requirements on the part of taxpayers and financial institutions to report transactions involving non-cooperative jurisdictions.

The recently concluded G-20 summit in London pledged "to take action against non-cooperative jurisdictions including tax havens."

The G-20 communique said, "We stand ready to deploy sanctions to protect our public finances and financial systems. The era of banking secrecy is over."