Indonesia assures expats using amnesty over tax evasion threat

Added 19th September 2016

Indonesia’s government has reassured participants of its tax amnesty programme that they will not be prosecuted for tax evasion after it emerged last week that private banks in Singapore are sharing with police the details of wealthy clients using the programme.

Indonesia assures expats using amnesty over tax evasion threat

Cabinet secretary Pramono Anung told Indonesian citizens, who account for an estimated $200bn (£153bn, €179bn) – or 40% - of total private banking assets managed in Singapore, that they will not be prosecuted for tax evasion for using the amnesty despite more stringent reporting standards by Singaporean regulators.

Singapore tightens rules

The guarantee comes a week after Reuters reported that Singapore‘s Commercial Affairs Department (CAD), a police unit that deals with financial crime, told banks last year they must file a suspicious transaction report (STR) whenever a client takes part in a tax amnesty scheme.

The rigorous disclosure measures were further reinforced by the Monetary Authority of Singapore (MAS) after the money-laundering scandal of Malaysia’s state-backed fund 1MDB exposed how some of its banks failed to impose robust controls on suspicious money flows.

The amnesty

Indonesia’s government is hoping the tax amnesty programme, launched in June, will make up some of the shortfall in tax revenues hit hard by sluggish economic growth and poor collections rates.

Under the amnesty, Indonesians can pay a tax rate starting at 4% on declared assets that they choose to leave overseas. The rate increases in stages to 10% as the programme draws to a close in March.

Indonesians who agree to repatriate their assets, for a period of at least three years, are offered a rate of only 2%, as well as a range of possible investments.

Poor repatriation rates

According to Bloomberg on Monday, the amnesty has delivered only a fraction - 18% - of the hoped-for revenue, prompting doubts of its success.

Indonesia’s finance ministry revealed on Friday, $8.9bn of assets held in Singapore have been declared, although just $107m - or 12% - of that figure has been repatriated back to Indonesia.

Visitor's Comments Add your comment

Add Your Comment

We won't publish your address


Regulatory landscape changes in the Middle East

Sponsored by Old Mutual International

Regulatory landscape changes in the Middle East...

Brendan Dolan, Regional Director, Middle East and Africa for Old Mutual International, talks about how the group is working with advisers as the regulatory landscape...

Square Mile Research

Matthews Pacific Tiger Fund
Matthews Pacific Tiger Fund...

Talking Factsheets is a video service for users...

About Author

Monira Matin

Senior Reporter

Monira joined International Adviser in March 2016 from Informa Global Markets where she worked as a eurobond reporter for over two years, covering fixed income markets. She has previously held a number of editorial positions covering politics, insurance and technology. Monira has a degree in Journalism and Economics from City University.


The turning tide of global equities

The turning tide of global equities

Despite a gloomy beginning to the year, global equities have started to outshine the backdrop of economic malaise that threatened their upward trajectory, with the index delivering 19.2%




Ashburton International
Ashburton International

Ashburton Investments is a new generation investment...



Offshore Bond Workshop Glasgow 2016
Offshore Bond Workshop Glasgow 2016

22nd November 2016
The Grand Central Hotel, Glasgow

Future Advisory Forum Dubai 2016
Future Advisory Forum Dubai 2016

23rd November 2016
Shangri-La Hotel, Dubai 

Sponsored Content

Investment Strategy