S’pore passes new tax laws

Mr Tharman told Parliament that the new standard enhances the scope of information exchange cooperation under the Avoidance of DTAs, by lifting the domestic interest condition and allowing for access to information from banks and trust companies under certain conditions. — ST PHOTO: STEPHANIE YEOW

PARLIAMENT on Monday passed a bill that will align the local tax regime with international standards, beefing up its efforts to stave off cross-border tax evasion.

The latest amendment to the Income Tax Act will allow Singapore to implement the internationally-agreed standard for the exchange of information (EOI) for tax purposes on request.

Finance Minister Tharman Shanmugaratnam told Parliament that the new standard enhances the scope of information exchange cooperation under the Avoidance of Double Taxation Agreements, or DTAs, by lifting the domestic interest condition and allowing for access to information from banks and trust companies under certain conditions.

The new amendment will also pave the way for Singapore to be taken off the Organisation of Economic Cooperation and Development’s (OECD) ‘grey’ list by the end of the year, added Mr Tharman.

The OECD has three lists: black, grey and white, with countries ranked on their willingness to stick to its standards. Countries on the black list are those ‘not committed to implement the internationally agreed tax standards’. Those on the ‘grey’ list, such as Singapore, are said to be committed to the standards but have yet to fully implement them, while the ‘whites’ have largely enforced the international rules.

In March, Singapore endorsed the OECD’s 2008 standard after it was accepted as the global benchmark by the United Nations’ Committee of Experts on International Cooperation in Tax Matters last October.

Source : Straits Times – 19 Oct 2009

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