JAKARTA: Indonesia and Singapore have agreed to step up efforts to share tax-related information to tighten loopholes on tax evasion in each other’s countries, Indonesia’s finance ministry said.
The commitment came after a meeting between Indonesian Finance Minister Bambang Brodjonegoro and his counterpart Tharman Shanmugaratnam in Singapore.
Indonesia and Singapore have had an agreement to exchange tax-related information upon request, including data from financial institution and individuals, since 1992.
Singapore’s finance ministry said the city-state and Indonesia have both endorsed the automatic exchange of information as a global standard, but Singapore’s implementation is guided by several principles.
“Exchanging information by request is not enough to reveal all assets hidden by citizens of both countries,” the Indonesian ministry said. “Therefore, to accelerate information flows, Indonesia and Singapore have committed to exchange information automatically to complement the mechanism for information exchange by request.”
The mechanism should start as early as 2017, or at the latest, by end of 2018, the statement said. Both countries have also agreed to amend local legislation to support the exchange of information.
The automatic information exchange must also be done “within a robust framework of law to protect taxpayer confidentiality and ensure that the information is used properly”, the Singapore ministry said, adding that there must be reciprocity with any future partners in terms of information exchanged.