SINGAPORE: Authorities here are reviewing the information being reported in connection with the Panama Papers leak and are doing the “necessary checks”, the Ministry of Finance (MOF) and Monetary Authority of Singapore (MAS) said on Wednesday (Apr 6).
The leaked papers comprise 11.5 million documents from law firm Mossack Fonseca, which specialises in creating offshore shell companies in the tax haven of Panama. The documents exposed how some of the world's most powerful people have secreted their money offshore.
“Singapore takes a serious view on tax evasion and will not tolerate its business and financial centre being used to facilitate tax related crimes,” MOF and MAS said in a statement.
“If there is evidence of wrongdoing by any individual or entity in Singapore, we will not hesitate to take firm action.”
Among those accused are close associates of Russian President Vladimir Putin, relatives of Chinese President Xi Jinping, the late father of British Prime Minister David Cameron and Argentine footballer Lionel Messi.
Also implicated was Iceland Prime Minister Sigmundur David Gunnlaugsson, who has announced he will step down after the leaked papers showed his wife owned an offshore firm with big claims on Iceland's collapsed banks.
While holding money in offshore companies is not illegal, the leaked documents could provide evidence of wealth hidden for tax evasion, money laundering, sanctions busting, drug deals or other crimes.
An article in the Irish Times on Tuesday made reference to a Singapore company that "helped clients set up offshore companies and trusts in the British Virgin Islands, the Cook Islands and other tax havens".
Meanwhile, a report in The West Australian said data showed that Australian companies funnelled almost A$110 billion (S$112 billion) in and out of Singapore in one year, and said the Republic is "by far more important" for Australian firms than major trading partners such as the US and Japan.
But MOF and MAS said Singapore has put in place a strong legal, tax, and regulatory framework, coupled with a rigorous supervisory regime, to tackle cross-border tax evasion and avoidance.
“Singapore is also firmly committed to upholding internationally accepted standards for exchange of information,” MOF and MAS said.
SINGAPORE'S WEALTH INDUSTRY UNLIKELY TO TAKE MATERIAL HIT: DBS
Commenting on the leak of information and its impact, DBS chief executive officer Piyush Gupta said the wealth industry is unlikely to take a material hit. "The notion is that if all wealth will stay within domestic borders and if the tax is declared, I don’t think that is likely to happen," he said in an interview with Channel NewsAsia's Asia Business First programme.
"Most people, perhaps you and me, try to manage our wealth and keep it in centres where you get good financial advice and therefore, the bulk tends to go in that form," he explained. "There are some 'bad guys', who are not paying the taxes or doing some illegal stuff, so frankly, this deserves to be stamped out."
A DBS spokesperson also said the use of professional services providers is common, but the law obliges the bank to identify the ultimate beneficiaries for offshore or trust structures.
"We do not support the use of concealment techniques. As with any incident, we study all information carefully and take action where required," the spokesperson said.
The Global Forum on Transparency and Exchange of Information for Tax Purposes, the key international body that assesses jurisdictions' implementation of the international standards on tax transparency, has assessed Singapore’s exchange of information regime as “largely compliant” with the international standard.
This is similar to its assessment for jurisdictions such as US and the UK, the statement said.