Singapore to provide information on US bank deposits
Singapore said Tuesday it has agreed to give the United States information on bank deposits by American individuals and corporations to help it deter tax evasion.
A joint statement by the finance ministry, central bank and internal revenue authority said the two countries had "substantially concluded" talks on an accord that will ease compliance with a US law requiring such information.
The Foreign Account Tax Compliance Act targets Americans using overseas bank accounts to avoid paying taxes at home.
It requires financial institutions outside the United States regularly to submit information on accounts held by Americans to the US Internal Revenue Service (IRS).
The US government can impose a 30 percent withholding tax on certain gross payments made from the United States to non-compliant foreign financial institutions.
Under the bilateral agreement, financial institutions based in Singapore -- including local branches of foreign banks -- will provide information on Americans' bank accounts to Singapore's tax authority, which will then pass on the details to the IRS.
The agreement will be signed later this year, the statement said.
The United States is cracking down on tax cheats who hide their incomes in financial safe havens such as Switzerland.
Singapore, a global financial centre and major player in the wealth management industry, has rejected accusations that it is a haven for foreign tax cheats.
Last year the government vowed to implement measures that would make it easier to share information with other countries on cross-border tax evaders trying to hide assets in the city-state.
It has amended laws so that the local revenue authority will no longer need a court order to get information from banks on accounts of suspected tax dodgers at the request of a foreign government.
Handling proceeds from tax evasion has also been made a crime.
French authorities last year sought Singapore's help with an international probe into suspected tax fraud by a former budget minister.
Jerome Cahuzac stepped down last year after prosecutors announced there would be a full criminal inquiry into allegations that he had an undeclared bank account in Switzerland. He is also suspected of moving assets to Singapore to hide them from the tax authorities.
Assets managed by fund managers in Singapore totalled Sg$1.63 trillion ($1.33 trillion) as of the end of 2012, the central bank said.