Singapore complies with OECD tax standards
By Jonathan Peeris, Channel NewsAsia | Posted: 13 November 2009 1329 hrs

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SINGAPORE : Singapore has officially been removed from the grey list of financial jurisdictions by the Organisation for Economic Cooperation and Development (OECD).

On Friday, it signed its 12th avoidance of double taxation agreement (DTA) with France.

Singapore is officially out of the OECD grey list - having met the criteria of signing at least 12 DTAs.

The country now moves into the OECD category of jurisdictions deemed to have substantially implemented the standard.

Singapore is the 15th jurisdiction to have moved into the "substantially implemented" category since April 2009.

In signing the 12th DTA with France, Singapore's Finance Minister Tharman Shanmugaratnam dismissed concerns that the adoption of the standard would be detrimental to Singapore's quest to be a private banking centre.

Mr Tharman said: "For Singapore to retain its position as a premier financial centre, it has got to retain its position as a centre that is regarded as being well regulated, as a centre that is regarded as being trusted, both by consumers and users of the financial centre as well as fellow regulators.

"And we see this move as the right move that has to be taken by all countries at the same time. The level playing field is the most important principal that Singapore has been emphasising."

In a statement, OECD applauded the development as Singapore is a key player in the global financial community.

It said the fact that Singapore has changed its tax laws to implement the international standard confirms that there is a new global environment of tax cooperation.

French Finance Minister Christine Lagarde said the latest DTA is a "significant breakthrough" and supported the need for the OECD standard.

Ms Lagarde said: "We do want to improve the transparency, we do want to improve the discipline, and we need to eliminate those barriers. So it is because we went through the crisis and were able to analyse that obscurity, dark areas that were not conducive to either security or stability, that we decided that we had to do away with that darkness."

Mr Tharman also pledged that Singapore would play an active role in the Global Forum on Transparency and Exchange of Information after being appointed as the Vice Chairman of the Forum's Peer Review Group.

Separately, Singapore also signed a tax agreement with fellow ASEAN member Brunei on Friday.

Singapore's Minister in the Prime Minister's Office, Lim Hwee Hua, said the signing marks another significant milestone in the long-standing and special friendship between both countries.

Singapore endorsed the OECD standard for the exchange of tax information in March.

Since then, it has renegotiated existing agreements with various countries but also signed new agreements with jurisdictions including Mexico, Qatar, Norway and Britain. - CNA/ms