The BJP on Wednesday hit back at Congress leader Rahul Gandhi, saying that it was under the UPA government that the India-Cyprus tax treaty created a haven for tax evaders, and those who left are “your ‘Param Mitras’ and your legacy of promoting tax havens and opaque financial practices is what drove them out”.
The saffron party also said that the BJP government’s reforms have not only plugged these gaps, but have also showcased its unwavering commitment to transparent and accountable tax governance
In a post on X, BJP IT cell chief Amit Malviya said, “Let us get this straight – it was under the UPA government that the India-Cyprus tax treaty created a haven for tax evaders. You practically rolled out the red carpet for investors to bypass the capital gains tax, with Cyprus not imposing such taxes either. Add to that the low withholding tax rate, and you have got yourself a perfect recipe for creating a tax haven, luring businesses and individuals to funnel money into Cyprus.”
He added that when the BJP-led NDA came to power, “we saw through this charade and took immediate, decisive action”.
“In 2016, we didn’t just tweak the Double Taxation Avoidance Agreement (DTAA) with Cyprus, we overhauled it. Our revision, effective retrospectively from November 2013, was a game-changer. It shifted the taxation of capital gains right back to where the income is made — the source country — rather than letting investors hide behind the veil of their country of residence. This wasn’t just a policy shift, it was a direct challenge to the tax avoidance circus you had running,” Malviya said.
Taking a jibe at Rahul Gandhi, he said that let’s talk about the “grandfathering clause we introduced for investments made before April 1, 2017”.
“It wasn’t just a clause; it was a statement. We ensured a fair transition to the new regime, where capital gains would be taxed in the investor’s country of residence for investments made before this deadline,” the BJP leader said.
“This shift was monumental. It wasn’t just about fair taxation; it slammed the door shut on using offshore entities for tax evasion. The so-called ‘Golden Passport’ that you accuse us of promoting… It’s a relic of your governance, a symbol of the opaque, underhand dealings you endorsed,” he said.
“So, let us set the records straight. Those who have left are your ‘Param Mitras’. Your legacy of promoting tax havens and opaque financial practices is what drove them out. Our reforms have not only plugged these gaps, but have also showcased our unwavering commitment to transparent and accountable tax governance. Your accusations don’t just fall flat; they’re a stark reminder of your party’s dubious past,” Malviya added.
His remarks came after Rahul Gandhi earlier in the day trained his guns on businessman Gautam Adani, asking why the brother of a “Param Mitra” left India during “Amrit Kaal”.
