Response to "Singapore replaces Switzerland as tax haven" - Nanyang Siang Pau, 16 May 2012
1 June 2012
Editor-in-Chief Nanyang Siang Pau
The article "Singapore replaces Switzerland as tax haven" (Nanyang Siang Pau, 16 May 2012) contains many inaccuracies.
2 First, the reference to Singapore as a tax haven is plainly wrong. A tax haven typically has a tax structure designed to attract enterprises and individuals keen to avoid tax and not requiring substantive local presence by such enterprises and individuals. Singapore’s tax system aims to attract substantive economic activities by keeping the tax burden on enterprises and individuals competitive - businesses are taxed at 17% and the highest individual income tax bracket is 20%. The tax system underpins a diversified, knowledge-based economy, spanning a wide range of economic sectors.
3 Second, there is no such thing as an “IMF list of tax havens”, which the article purports that Singapore is included in. Nor is Singapore being targeted by the US for tax evasion. Singapore does not and will not stand for abuse of its financial system to facilitate tax evasion and/or other crimes. As an international financial centre, Singapore is highly vigilant against illicit funds that could threaten its integrity and stands committed to active cooperation with international partners to deter and prevent criminal abuse. Singapore endorses and implements the internationally agreed Standard for Exchange of Information (the EOI Standard) for tax purposes in its tax treaties. The level of tax cooperation we render to our tax treaty partners is fully in line with global standards.
4 Third, the successful development of Singapore’s financial sector is underpinned by high standards of financial regulation and supervision, not low taxes per se. Singapore’s banking and financial system is open and transparent, and rules are rigorously enforced. Investors choose Singapore as the place in which to manage their wealth because of the country’s economic and political stability, sound regulation, rule of law, and depth of fund management expertise. While our laws provide customers of banks the right to confidentiality of information, banking confidentiality has never been a bar to providing information to assist domestic or foreign authorities in bona fide investigations of potential criminal activities.
5 I would be grateful if you could publish this letter in full so that your readers will have the benefit of the facts.
Filbert Tay Press Officer High Commission of the Republic of Singapore Kuala Lumpur