Calling upon revenue intelligence agencies to enhance cooperation with their global counterparts to check tax evasion and smuggling, Finance Minister Arun Jaitley today said free trade should also mean fair trade.
Although the fiscal incentives for financial malpractices have come down over the years, the Minister said revenue intelligence officials must increase global cooperation to “check tax evasion and smuggling.”
While inaugurating the 2nd Regional Customs Enforcement conference here, the Minister stressed that effective steps to curb tax evasion and avoidance are necessary to ensure that “free trade remains fair trade.”
Jaitley also called upon revenue intelligence officials to increase the use of technology and develop the ability to read between the lines to check financial malpractices.
The dynamics of revenue intelligence would continue to evolve with changing times, he said, adding “world is obliterating the distinction between tax evasion and tax avoidance.”
He said there was a time when the incentive for tax evasion and smuggling was high. However, with the decline in tax rates, tariffs and duties, the “incentive for (financial malpractices) is going down.”
India has been vociferously raising the issues concerning tax evasion and avoidance at several international meetings, especially at the G-20 deliberations.
The Finance Minister further said that in an era of free trade and liberalisation, there is a need for global and international cooperation as well as sharing of intelligence information among countries, especially among neighbouring ones in order to control the illicit movement of goods across the border.
Officers need to be trained in order to read between the lines and be fully equipped to handle the latest technology tools efficiently and effectively in order to keep pace with the techniques used by tax evaders who always try to exploit the loopholes in the law, he said.
This two-day meeting is also being attended by the heads of customs and enforcement department from neighbouring countries, including Bhutan, Nepal, Bangladesh, Myanmar and Sri Lanka.
He said discussions during the conference will be focused on common areas of concern relating to enforcement, including issues relating to smuggling of Fake Indian Counterfeit Notes (FICN), issues pertaining to country of origin certificate, drug trafficking, smuggling of gold and sharing of SAARC-CMAA experiences, among others.
Speaking on the occasion, Revenue Secretary Shaktikanta Das asked the customs and DRI officers to work in a non-intrusive manner so that legitimate movement of goods and services across the border and within the country is not adversely affected.
Those who are doing trade in a legitimate and fair manner should be encouraged and be treated in a friendly manner, he added.