From the Twittersphere, our Director of Research:
This time it’s Singapore, and a story in the Sydney Morning Herald entitled Singapore’s government says it’s not a tax haven, it’s a value-adding hub.
Of course it’s not. (It’s only ranked fifth on our Financial Secrecy Index.)
One of our light-hearted tests for a tax haven is that it feels the need to deny being a tax haven. Nobody likes a taint: this kind of theatre of probity is deemed necessary for those jurisdictions seeking to persuade the world’s hot money to come to their shores. They are all at it.
The Australian newspaper journalist Nassim Khadem fortunately shies away from doing the tax haven’s public relations for it, and she takes alternative views into account:
“Companies such as Google, Apple, Microsoft, BHP Billiton and Rio Tinto have all admitted in recent hearings as part of the Senate inquiry into corporate tax avoidance that they are under audit by the ATO for their use of Singapore “marketing” and “service” hubs, where they route hundreds of millions of dollars of income.
. . .
Tax Justice Network spokesman Mark Zirnsak said Singapore in recent years had made “commendable improvements in transparency and a willingness to co-operate with other governments on cases of tax evasion and money laundering”. “However, as demonstrated by the Senate inquiry, Singapore continues to be willing to offer special tax deals to multinational corporations that provide incentives for profit shifting and tax avoidance,” he said.”
Zirnsak of TJN-Australia is quite right to point to the Singapore-based shenanigans this Australian Senate Inquiry, which as we recently noted, is a landmark process that is the latest strong sign of fast-changing global perceptions of tax cheating by large multinational corporations.
For more on Singapore as a tax haven, see the SMH’s story entitled Singapore remains the top choice for multinational hubs, tax data shows (“Australian companies sent more than $64 billion to related parties in Singapore and Switzerland, where they pay little or no tax at all”) and Multinationals channel more money through “hubs” in Singapore, Switzerland than ever before, Tax Office says (“More than half of Australia’s trade is money being sent offshore by companies to their overseas arms – with almost a third going to Singapore and Switzerland.”)
For more longer-tem background information about how Singapore became a secrecy jurisdiction or tax haven, see our Singapore Narrative Report, written in 2013. We’ll be updating it in the coming months.
To finish, another very relevant and important tweet, this time from our chums at Global Witness: