Indonesians assured over Singaporean tax amnesty action fears
Indonesian officials have taken the unusual step of reassuring Indonesian taxpayers who have undeclared assets stashed in Singaporean institutions that they will not be targeted by Singaporean officials if they come forward.
Despite recent reports that Singaporean banks are sharing the names of their clients embracing Indonesia’s tax amnesty with the local police, the State Palace believes the neighboring country will not hinder the implementation of the program.
Indonesian cabinet secretary Pramono Anung called on Indonesian taxpayers who have money stashed in Singapore to “not be afraid” of participating in the tax pardon, the Jakarta Post reported on Saturday.
He rejected reports that participation in the program would be considered tax evasion in the neighboring country. The scheme is understood to have seen more than 117.3 trillion rupiah US$12bn declared by Indonesians since the programme was introduced in Jakarta in June.
Anung explained that finance minister Sri Mulyani Indrawati had communicated with her counterpart in Singapore about the issue. In addition, during a meeting at the ASEAN Summit last week, the Singaporean finance minister and prime minister assured attendees that the country was making no attempts to hinder the tax amnesty program.
‘Do not be afraid’
“Thus, anyone who puts their assets in Singapore and wants to join the tax amnesty, whether in the form of assets repatriation or declaration, please do not be afraid because the applicable law is the Indonesian tax regulation,” Anung said in Jakarta on Friday.
Meanwhile, finance minister Sri Mulyani also reiterated that the Singaporean government had told her that it had asked Singaporean banks to facilitate the participation of their high-wealth Indonesian customers in the program.
“There are four Singaporean banks where Indonesian high-wealth individuals put their money. They were asked to facilitate and provide ease for customers joining the tax amnesty and they also confirmed the reported transactions were not classified as suspicious,” she said.
As reported, Indonesia became the latest country to launch tax amnesty programme, in an effort boost its tax coffers ahead of the introduction of the OECD’s Common Reporting Standard. The CRS is aimed at introducing a global system of automatic exchange of information over the next two years.
Other countries which have also introduced tax amnesties have included Argentina and, as reported, South Africa.
Also n July, as reported, Singapore formally refuted claims that it was trying to undermine Indonesia’s then-just-launched tax amnesty scheme. In a joint statement, the city-state’s Finance Ministry and Monetary Authority of Singapore said Singapore “has not cut tax rates or changed any of our policies in response to Indonesia’s Tax Amnesty Programme”.