Bank secrecy is dead – also for the Philippines?

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PHILIPPINES-ECONOMY-FOREXThe Organisation for Economic Cooperation and Development (OECD), an international economic grouping of 34 countries, has urged the Philippines to lift its bank secrecy law “to strengthen the country’s tax system and fight tax evasion while meeting global standards in tracking tax fraud.”

“Bank secrecy is dead,” said Richard Parry, head of OECD’s Global Relations Division in the Center for Tax Policy and Administration, in a briefing on the sidelines of the Asia-Pacific Economic Cooperation (APEC) Workshop on Fiscal Management Through Transparency and Reforms held in Bataan province, west of Manila.

Parry added that G20 countries have abolished their laws on bank secrecy to align them with international standards. He said the Philippine government needs to have legislation in place to meet these global standards on transparency.

“It is possible to do it. The political will is needed for the Philippines to meet international standards in that area,” he said.

Currently, about 3.6 per cent of global gross domestic product (GDP) is lost to illegal financial flows, according tot he OECD. It was “not easy” for governments to tackle these issues especially if there is lack of transparency, Parry said. Transparency, he added, will allow governments to assess risks.

The bank secrecy law is a special legislation that requires banks and financial institutions to protect and keep confidential customer information from third parties even if these are government or tax authorities, unless the client relieves the bank of its duty.

In the Philippines, a violator can be convicted to an imprisonment of not more than five years or a monetary fine, or both, depending on the court’s decision.

In March 2014, Bureau of Internal Revenue commissioner Kim Henares urged lawmakers to lift the bank secrecy law amid renewed calls for greater exchange of information and increased transparency globally.

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Reading Time: 2 minutes

The Organisation for Economic Cooperation and Development (OECD), an international economic grouping of 34 countries, has urged the Philippines to lift its bank secrecy law “to strengthen the country’s tax system and fight tax evasion while meeting global standards in tracking tax fraud.”

Reading Time: 2 minutes

PHILIPPINES-ECONOMY-FOREXThe Organisation for Economic Cooperation and Development (OECD), an international economic grouping of 34 countries, has urged the Philippines to lift its bank secrecy law “to strengthen the country’s tax system and fight tax evasion while meeting global standards in tracking tax fraud.”

“Bank secrecy is dead,” said Richard Parry, head of OECD’s Global Relations Division in the Center for Tax Policy and Administration, in a briefing on the sidelines of the Asia-Pacific Economic Cooperation (APEC) Workshop on Fiscal Management Through Transparency and Reforms held in Bataan province, west of Manila.

Parry added that G20 countries have abolished their laws on bank secrecy to align them with international standards. He said the Philippine government needs to have legislation in place to meet these global standards on transparency.

“It is possible to do it. The political will is needed for the Philippines to meet international standards in that area,” he said.

Currently, about 3.6 per cent of global gross domestic product (GDP) is lost to illegal financial flows, according tot he OECD. It was “not easy” for governments to tackle these issues especially if there is lack of transparency, Parry said. Transparency, he added, will allow governments to assess risks.

The bank secrecy law is a special legislation that requires banks and financial institutions to protect and keep confidential customer information from third parties even if these are government or tax authorities, unless the client relieves the bank of its duty.

In the Philippines, a violator can be convicted to an imprisonment of not more than five years or a monetary fine, or both, depending on the court’s decision.

In March 2014, Bureau of Internal Revenue commissioner Kim Henares urged lawmakers to lift the bank secrecy law amid renewed calls for greater exchange of information and increased transparency globally.

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