Sweet Account

By Kim Jae-won 

Korea will be able to access information on Swiss bank accounts held by Koreans according to the finance ministry, Friday.

The Ministry of Strategy and Finance said that Korea and Switzerland have agreed to revise a double-taxation avoidance deal and that the revised treaty will become effective from July 25.

The ministry said that the deal will make it easier for each nation to request and obtain financial information on individuals suspected of hiding money in secret bank accounts for tax evasion purposes

Both countries exchanged ratification documents for the bilateral tax treaty revision in Bern, Tuesday. It was ratified by the National Assembly in February and the Swiss followed suit earlier this month.

The ratification followed the two countries’ agreement to revise their tax treaty in 2010 on the exchange of information about financial activities by nationals of each other’s country. 

Switzerland has often been regarded as a safe haven for those who want to stash away ill-gotten wealth without paying taxes thanks to the country’s strict banking privacy laws. These have recently been loosened due to actions taken by other countries regarding their nationals’ accounts. 

“We will exchange financial information with Switzerland, which had kept its doors closed under the principle of banking privacy,” said Lim Hwan-soo, an assistant commissioner of the National Tax Service (NTS) at a news conference earlier this week. 

Under the treaty, Switzerland agreed to provide banking information on Korean nationals for the purpose of equitable taxation 

“If it comes to it, we will be able to check Credit Suisse bank accounts of Koreans we suspect of being tax evaders,” said Hwang In-woong, a director at the finance ministry. 

This is a drastic change for the European country which had refused to unveil bank customers’ information under the principle of banking privacy guaranteed by its Constitution. 
But it has been forced to open up after foreign governments and international organizations, in particular, the United States and the Organization for Economic Cooperation and Development, pressured it to do so by imposing fines on Swiss banks and filing lawsuits against them. 

The NTS is also planning to share tax information with the Marshall Islands and Cook Islands. 

“We will trace and levy taxes on illegal capital outflow and overseas tax evasion conducted by big conglomerates, mid-tier firms and rich people,” a tax official said. 

Meanwhile, the owner of a medium-sized firm, identified only by his surname Hong, was one of eight people exemplified by the NTS for tax evasion. Tax officials said he established a paper company in Switzerland, and bought stakes in a Korean business through the fake firm. 

He earned 7.1 billion won from dividends from the Korean company and made 28.3 billion won from selling shares but did not report the income. The NTS levied 13.3 billion won in income tax on Hong and imposed fines for not reporting his overseas financial accounts. 

*********************************************************************************

Tun Dr Mahathir Mohamad today said it is true that he fears an opposition victory in the 13th general election as he is afraid of the abuse of power by Pakatan Rakyat’s leaders.

The former Prime Minister said he was afraid of the kind of abuse of power that has already been shown.

Dr Mahathir wrote (DAP leader) Lim Kit Siang reportedly said that he (Dr Mahathir) was working hard to ensure the Opposition would not win because he is afraid when the Opposition Government is in place, it would act against all his “misdeeds” when he was the Prime Minister.

“No doubt he is inspired by what happened to Gadaffi and Mubarak. He would love to see me dragged to the courts and sentenced to death or to at least a life sentence. Maybe like Gadaffi I would be murdered.

“He is right. I am afraid. I am afraid of the kind of abuse of power that has already been shown by one of Pakatan’s great leader who got a senior police officer to frighten Dr Ristina and Ummi Hafilda into withdrawing Ummi’s letter to me.

“I am afraid of the fabrication of charges so as to put me behind bars. That I am innocent would be irrelevant. What is important is Kit Siang’s satisfaction at seeing me behind bars and more,” he added.

However, Dr Mahathir said, he would go with a clean conscience.

Writing in his blog Che Det, Dr Mahathir said aside from those concerns, Dr Mahathir said he was not afraid.

“I had always been careful not to abuse the power I had as PM because I was mindful of having to step down and lose power at some stage,” he said.

“If I had abused power my detractors would gleefully expose me and strive to put me behind bars,” he said, adding that there have been several attempts to do just that, all with the same results.

“So far nothing could be pinned on me,” he said.

“The anti-corruption people can even now investigate whether I have ever received illegal gratifications, whether I have detained or thrown people into jail for personal reasons, whether I benefitted personally from any of the projects carried out during my time,” he said.

Dr Mahathir said that while he was Prime Minister he did not use his power to procure government contracts, for either him or his children.

“Whatever money I now have is from savings during 29 years in the Government,” he said.

“I am not interested in getting rich or living a life of luxury,” he said. “What I have now is far more than I had hoped for when I was dreaming as a student. I am grateful to Allah for what I have and for sparing me to live this long.”

*****************************************************************************

It is time we as Malaysian must ensure all the sweet accounts are revealed.  I know that all our past and present Ministers, cronies and Royalty have such account.  Secrets are no longer hidden.  Government servants have to co-operate too.

We should begin with white tiger and mamak kutty.