Indeed it is important for us to store financial data within the country to stop non tax abiding citizens.
Money laundering is also a huge problem. Citizens were being educated, not to take cash in large amounts, for the same reason.
Even after demonetization, government was not able to get rid of black money.
Edit: grammar
Countries can already demand any business records of their citizens from a business as a condition of doing business in that country or citizens.
The US requires that any fin business that does business with US Citizens report to the United States government or be cut off from the US financial system. A lot of international banks responded by closing the accounts of Americans rather than deal with the costs of compliance.
>The total amount of black money deposited in foreign banks by Indians is unknown. Some reports claim a total of US$1.06 - $1.4 trillions is held illegally in Switzerland. Other reports, including those reported by the Swiss Bankers Association and the Government of Switzerland, claim these reports are false and fabricated, and the total amount held in all Swiss bank accounts by citizens of India is about US$2 billion. In March 2018, it was revealed that the amount of Indian black money currently present in Swiss and other offshore banks is estimated to be ₹90 lakh crores or US$1500 billion.
https://en.wikipedia.org/wiki/Indian_black_money
Getting Switzerland to release that information isn't that easy. I have been hearing about it for at least 5 years, may be more. Even 4 days ago, there were reports like this: https://www.businesstoday.in/current/economy-politics/noose-...