Singapore’s wealth management industry is likely to suffer a bad dent as rich Indonesians move some money back home to take advantage of a tax amnesty, but the exodus of funds isn’t going to be as big as Jakarta is predicting.
Around $200 billion of Indonesian money that may not have been declared to the tax authorities in Jakarta has been squirreled away in Singapore, according to private banking sources. It is a huge portion of the approximately $470 billion of assets under management by private banks in the financial hub.
Consultants, lawyers and bankers closely involved with the industry expect roughly $30 billion to go to Indonesia under the amnesty, which was launched last week and allows all past evasion sins to be forgiven upon the payment of up to five percent tax on the money.