On 09.07.2015, India and United States signed an Inter-Governmental Agreement (IGA) to implement the Foreign Account Tax Compliance Act (FATCA). The objective of the agreement is to promote transparency between the two nations on tax matters and improve international tax compliance. The agreement is an important step for the Government of India to tackle offshore tax evasion and fight the menace of black money by enabling the Indian tax authorities to receive financial account information of Indians from foreign countries on an automatic basis. The exchange of information on automatic basis, regarding offshore accounts under FATCA would deter tax offenders, would enhance tax transparency and eventually bring in higher equity in to the direct tax regime for a healthy economy.
-Ministry of Finance