Germany to negotiate deal with Singapore against tax evasion
BERLIN (Reuters) - Germany will start talks with Singapore next week on a deal to prevent its citizens from evading taxes by shifting their money to the Asian state, a government source said on Saturday.
During a visit to Asia next week, German Finance Minister Wolfgang Schaeuble will fly to Singapore, the region's prominent wealth management center, to try to negotiate an agreement with the government, the source said.
According to media reports, there are signs German tax dodgers are shifting funds to Singapore from Switzerland, which signed a tax deal with Germany earlier this year.
The source said hopes were high that Singapore would agree to give German authorities information on assets held in the country by wealthy German citizens as it had stressed earlier this year it did not tolerate tax evasion.
"We are acting on the assumption that Singapore is pursuing a clean money strategy," the source said.
Singapore's central bank said in August it had warned banks last year to guard against funds being transferred into the island state to evade taxation elsewhere, with an eye to new tax treaties being implemented in Europe.
It did not tolerate such flows, and Singapore was cooperating with other countries to prevent abuse of its financial system, a spokeswoman for the Monetary Authority of Singapore said.
Switzerland and Germany hammered out a new deal in April to confront tax evasion, but the center-left SPD opposition has said it will block the pact in the upper house of parliament as it is too lenient on tax dodgers.
One of the SPD's criticisms has been that, as it stands, the agreement would allow people to evade taxes by taking their money out of Switzerland before the deal takes effect.