Stanley White & Nopporn Wong-Anan
Singapore will revise its laws this year to improve disclosure on foreigners evading income taxes in their home countries, its finance minister told his Japanese counterpart, a Japanese Finance Ministry official said.
Singapore agreed at the beginning of March to bring its tax laws in line with Organisation for Economic Cooperation and Development (OECD) standards after the Paris-based group put it on a “grey list” of countries that have not signed international accords to combat tax evasion.
Japanese Finance Minister Kaoru Yosano welcomed Singapore Finance Minister Tharman Shanmugaratnam’s pledge, the official told reporters after the two met on Monday.
World leaders said at a Group of 20 summit this month that they would crack down on tax havens, including sanctions against non-cooperative jurisdictions, by using information from the OECD.
Singapore’s government has previously denied suggestions that the country is a tax haven.
Singapore has strict bank secrecy laws and has been promoting itself as a rival financial centre to Hong Kong to attract banks such as UBS, Credit Suisse and Citigroup to manage money for rich local and foreign clients.
Analysts say Singapore still has other competitive advantages to offer foreign investors after it amends the laws.
“On the margin it would make Singapore less attractive,” said David Cohen of Action Economics. “I think there are enough other attractions for investors looking for channels for investing in Asian companies and markets,” he said, adding these included a wealth management business with good insight into the region.
Tharman also told Yosano that he hoped officials could agree on a broad range of measures, including expanding currency swaps, at a meeting of the Association of Southeast Asian Nations, China, South Korea and Japan on May 3, according to the official.
Asian countries pledged last year to pool bilateral currency swap arrangements under the Chiang Mai Initiative in an $80 billion multilateral fund that could be tapped in emergencies.
ASEAN groups Cambodia, Malaysia, Indonesia, Singapore, Vietnam, Philippines, Laos, Thailand, Myanmar and Brunei.