SINGAPORE: France on Friday lauded Singapore for entering into a new pact that tightens measures against foreign tax cheats seeking to hide their assets in the Asian financial hub.
The revised agreement on double taxation, signed late Thursday by French Finance Minister Michel Sapin and his counterpart Tharman Shanmugaratnam, seeks to promote business ties between the two countries while plugging tax loopholes.
“We must improve information exchange between our two countries,” Sapin told Agence France-Presse on Friday in written remarks, before leaving for Indonesia as part of an Asian tour that also includes Japan.
“Our relations are already good but thanks to this agreement, we will be at a world-class standard in the fight against tax fraud and going after accounts that are kept hidden from tax authorities—I don’t need to spell it out for you.”
French budget minister Jerome Cahuzac was forced to step down in March 2013 after being accused of having an undeclared Swiss bank account and moving assets to Singapore to hide them from tax authorities in France, where prosecutors want to bring him to trial.
The new French-Singapore agreement offers improved terms for companies in both countries.
“It also contains anti-abuse provisions that will enable us to fight against the kind of tax avoidance that some companies have been indulging in, while also permitting us to fine-tune other situations which can lead to double taxation of some companies,” Sapin said.
“Beyond this agreement, we want to make sure that Singapore is truly part of this major international movement leading us to the automatic exchange of information between all countries. France has decided to do that with 60 other countries in 2017. Singapore is poised to make it in 2018.”
The Paris-based Organization for Economic Cooperation and Development had initially included Singapore in a “grey list” of global tax havens but the island nation has since been removed after entering into tax data-sharing agreements with major partners.
Last month, Singapore signed an agreement to facilitate compliance by its financial institutions with US laws targeting Americans who use overseas accounts to evade taxes.
Singapore is one of the favorite Asian destinations of French companies and professionals. An estimated 15,000 French citizens now live in the wealthy city-state.