Singapore ready for 'automatic exchange of financial account information' relationship with Indonesia: MOF

Singapore's Ministry of Finance said on July 12, 2017, that the country is ready to have an Automatic Exchange of Financial Account Information (AEOI) relationship with Indonesia. ST PHOTO: KUA CHEE SIONG

JAKARTA - Singapore stands ready to have a Automatic Exchange of Financial Account Information (AEOI) relationship with Indonesia, as soon as Indonesia is ready, said Senior Minister of State for Finance and Law, Ms Indranee Rajah.

This includes Indonesia putting in place the internationally required confidentiality and data protection safeguards before the exchange of information can take place, she added.

"On Singapore's side, these are in place, and we look forward to when Indonesia is able to let us know that the requirements have been met and this can be operationalised," said Ms Indranee.

The minister was speaking to reporters after attending the International Tax Conference in Jakarta on Wednesday (July 12).

Her remarks also come after The Jakarta Post reported earlier that Indonesia and Singapore will soon sign a bilateral competent authority agreement (BCAA) to implement the AEOI.

The AEOI is a new standard that entails a regular exchange of taxpayer information, which may include details of their bank accounts and assets, for authorities to act against tax evasion.

The report also said the Indonesian government will "hunt down funds owned by Indonesians who park their money in Singapore, following an offer from Singapore to allow Indonesia to access the financial data of Indonesians in the neighbouring country".

Singapore had, on June 21, signed two international agreements aimed at making it easier for the country to exchange tax information with other jurisdictions as part of ongoing global efforts to combat tax evasion and money laundering, as well as improve tax transparency.

Called multilateral competent authority agreements (MCAAs), they lay out an international framework to facilitate the automatic exchange of tax information hence avoiding the need for countries to conclude multiple bilateral agreements.

The first agreement covers the AEOI under the Common Reporting Standard (CRS), and the second covers the exchange of country-by-country reports.

Ms Indranee said that following the signing of the MCAA on the AEOI under the CRS, Singapore and Indonesia have both listed each other as partners.

"And with the multilateral competent authority agreement or MCAA, it won't be necessary to have a bilateral agreement because it's actually provided for in the framework of the MCAA," she said when asked about the BCAA with Indonesia.

Singapore's Ministry of Finance, responding to queries from The Straits Times on Wednesday, also confirmed it has been working closely with its Indonesian counterparts to ensure both parties can commence reciprocal exchange of information.

Indonesian Finance Minister Sri Mulyani Indrawati said on the sidelines of the tax conference on Wednesday that her ministry will maintain communications with Singapore in regard to the AEOI agreements.

She had estimated previously that about 60 per cent of one quadrillion rupiah (S$103.3 billion) worth of assets kept abroad by wealthy Indonesians is banked in Singapore.

Join ST's Telegram channel here and get the latest breaking news delivered to you.