S’pore, Australia to share data to fight tax evasion

SINGAPORE — The Republic and Australia have signed an agreement to exchange information on the financial accounts held by each other’s residents in a bid to fight tax evasion, adding that the confidentiality of the data will be protected.

In a joint statement yesterday, the Inland Revenue Authority of Singapore (Iras) and the Australian Taxation Office (ATO) said they have entered into a Competent Authority Agreement on the automatic exchange of financial account information (AEOI) based on the international Common Reporting Standard (CRS).

Under the agreement, Iras will automatically exchange with the ATO financial information of accounts in Singapore held by Australian tax residents, while the ATO will likewise share with Iras financial information of accounts in Australia held by Singapore tax residents. This sharing of information will commence by September 2018.

“Both jurisdictions are satisfied with the confidentiality rules and data safeguards that are in place in the other jurisdiction to ensure the confidentiality of information exchanged and prevent its unauthorised use,” the two tax authorities said. Both countries will also work towards implementing AEOI with other major financial centres to ensure a level playing field, they added.

The CRS is an internationally agreed standard for AEOI, endorsed by the Organisation for Economic Co-operation (OECD) and Development and Global Forum for Transparency and Exchange of Information for Tax Purposes. Participating jurisdictions that implement AEOI send and receive pre-agreed information each year, without having to send a specific request. This helps the discovery of tax evasion and enables governments to recover tax revenue from non-compliant taxpayers.

More than 100 jurisdictions have endorsed the CRS and will commence AEOI in either 2017 or 2018. Among them, British Virgin Islands, Cayman Islands, the United Kingdom and Spain have undertaken to have their first exchanges by next year, while Malaysia, the Bahamas, Panama and Hong Kong will do so by 2018, according to commitments received by the OECD. Deputy Prime Minister Tharman Shanmugaratnam had signalled in Parliament in 2014 that Singapore aimed to implement the AEOI by 2018.

Yesterday, Mr Ravi Menon, managing director of the Monetary Authority of Singapore, reiterated that the Republic is committed to global standards and said it is in negotiations with several countries on reciprocal agreements.

“We are very pleased that we have managed to conclude an agreement with Australia. For us, it’s very important that there is reciprocity in these agreements, that there must a level playing field and there must be rule of law and strong confidentiality provisions, that information that is now provided much more readily to the relevant competent authorities are safeguarded, and Australia and Singapore are two countries that share many of these traits,” he said at an event hosted by the Foreign Correspondents Association in Singapore.

When asked if Singapore would be signing such an agreement with Malaysia and Indonesia, Mr Menon did not address the question directly, but said: “There’s a long list of countries that we are currently engaged in. There’s no country that is excluded from the list and in good time I see us signing agreements with many countries. I can’t say anything in particular about one or two countries.” WITH ADDITIONAL REPORTING BY LEE YEN NEE