Singapore has been removed from two tax blacklists in Italy, making it easier for Italian companies to do business here.
The change has come because Singapore has adopted Organisation for Economic Cooperation and Development (OECD) standards for the automatic exchange of tax information, Italy's Minister of Economy and Finances Pier Carlo Padoan told the media during a visit here yesterday.
Tax blacklists are regulations that prescribe negative treatment for certain transactions involving specified foreign jurisdictions.
The two blacklists Singapore has been removed from involve rules surrounding Italian residents controlling companies here, and the tax deductibility of firms' expenses.
Singapore's removal from the blacklists will benefit Italian businesses with operations and investments in Singapore, thereby facilitating trade and investments between the two countries, a spokesman for the Ministry of Finance said yesterday.
Dr Padoan, who was on an official visit here, also urged Singapore to open an embassy in Italy to facilitate opportunities for Italian small and medium-sized enterprises (SMEs) keen on expanding here and into the region.
Singapore operates a consulate-general in Rome, rather than a full embassy. There are about 300 Italian companies with a presence in Singapore, primarily in the services, electronics and chemical sectors.
"(A Singapore embassy in Italy) would help to attract Italian companies to Singapore... There are a large number of dynamic SMEs in Italy which would benefit from accessing Asia through Singapore," said Dr Padoan, who was previously deputy secretary-general and chief economist of the OECD. He was appointed to his current role last year.
During a public lecture held yesterday at the Lee Kuan Yew School of Public Policy on the outlook for the European monetary union, Dr Padoan said developing common institutions in Europe is in essence a "trust-building exercise", not just between European Union member states but also between policymakers and voters.
"(Confidence in Europe) will be strong to the extent that families will see job opportunities for their children increasing, not decreasing," he said.
Dr Padoan met Prime Minister Lee Hsien Loong, Deputy Prime Minister Tharman Shanmugaratnam, as well as other government and private sector representatives during his two-day visit. He left Singapore last night.
Italy was Singapore's sixth-largest trading partner in the European Union last year and the 25th-largest trading partner globally.