The US has reached an agreement with Singapore on sharing tax information on bank deposits by American individuals and corporations in the Asian country to help it deter tax evasion.

A joint statement made by the two sides on May 5 said that the deal, known as an intergovernmental agreement (IGA), will require Singapore’s banks and investment funds, including foreign bank branches in Singapore, to provide the US Internal Revenue Service (IRS) with information on US enterprises and individuals who have more than 50,000 USD in their accounts.

The agreement requires Singapore-based financial institutions to comply with the so-called US Foreign Account Tax Compliance Act (FATCA).

Issued in March 2010, FATCA aims to detect and combat the tax evasion actions of Americans worldwide. Through the Act, the US hopes to prevent its citizens from taking advantage of foreign financial institutions to avoid paying taxes at home.

The US Government signed agreements on enforcing the FATCA with 22 countries and territories. It is attempting to negotiate with at least 50 more towards inking similar deals.

According to Singapore’s central bank, assets managed by fund managers in the country totaled 1.63 trillion Singaporean dollars (1.3 trillion USD) by the end of 2012.-VNA