On May 17th the Deputy Prime Minister of Thailand Kittiratt Na-Ranong revealed that urgent action has been initiated to strengthen the country’s legislations against money laundering in order to ensure that Thailand is not demoted to the “blacklist” of nations by the Financial Action Task Force (FATF).

According to Kittiratt Na-Ranong, two new draft bills have already been submitted to the cabinet to amend the national Anti-Money Laundering Act and the Anti-Terrorism Act. The two acts are scheduled to be presented to parliament later this year. It is hoped that if the bills are approved,Thailand will be removed from the FATF’s list of uncooperative countries.

The Prime Minister of Thailand Yingluck Shinawatra is scheduled to hold a meeting on May 19th with the Joint Private Standing Committee, which is comprised of the three largest business associations in Thailand, to discuss the importance of implementing the revised AML laws. Earlier this week the Committee said that it would urge the Prime Minister to take all necessary steps to ensure that the new laws are instated and active before February 2013.

Earlier this week the secretary-general of Thailand’s Anti-Money -Laundering Office (AMLO) Sihanart Prayoonrat held a press conference, in which he claimed that Thailand’s inclusion in the FATF “grey list” of uncooperative countries has already created problems for the national tourism industry, as it makes it more difficult for money to be transferred into and out of the country.

In February this year the FATF labelled Thailand as a nation which has …” not made sufficient progress in addressing the deficiencies or have not committed to an action plan developed with the FATF to address the deficiencies.”

Photo by Images_of_Money

On May 16th every member of the US House of Representatives and the US Senate received a letter signed by 41 American businesses and non-government organizations, urging the politicians to co-sponsor or support the Incorporation Transparency and Law Enforcement Assistance Act.

If passed into law, the new act would require all companies to disclose their ultimate beneficial owners at the time they are incorporated. It is believed that the regulations would greatly reduce the national and international occurrence of corruption and money laundering with the use of US registered shell companies.

Commenting on the intentions of the letter, the managing director at Global Financial Integrity Tom Cardamone said that “…anonymous shell companies make the U.S. financial system a playground for both foreign and domestic corrupt, criminal, and tax evading money.” He continued on to say that enacting the new law is critical for the USA, both in regards to law enforcement and national security.

According to the letter, over 2 million companies are incorporate in the USA every year, and investigations be international and national law enforcement agencies are continuing to reveal widespread use of US shell companies by ” terrorists, narco-traffickers, arms dealers, corrupt foreign officials, tax evaders, [and] individuals targeted for financial sanctions.”

The act was first introduced on August 2nd 2011, and, according to Global Financial Integrity, already has the support of the Obama Administration, the Department of the Treasury, the Department of Homeland Security, the US Department of Justice, along with several law enforcement agencies.

Photo by wallyg

In a statement issued on May 15th the Philippines’ Bureau of Internal Revenue (BIR) confirmed that tax collections in the country only reached PHP 345.4 billion during the first quarter of the current year, with only PHP 116.2 billion collected during April.

Tax collections in the Philippines over April were up by 12.4 percent, compared to the same period in 2011, but were nearly 5 percent lower than the government’s plan of PHP 122.8 billion. Tax experts in the Philippines have already commented on the result, saying that the lower than expected collections were surprising, because April is normally the busiest month for the BIR as it is the deadline for filing of annual income tax returns in the country.

The cumulative tax collections for the first quarter of the year were approximately PHP 10.1 billion below the planned total of PHP 355.5 billion, but exceeded last year’s collection by 13.97 percent.

Commenting on the results, the commissioner of the BIR Kim Henares said, “…we need help in revenue forecasting. The annual target-setting is already imperfect, but breaking it down on a monthly basis is even more imperfect.”

Despite the low collections Kim Henares noted that revenues are growing compared to the same period over the last year, indicating that the government’s efforts to expand the tax base and improve overall tax compliance are working.

Photo by robnguyen01

On May 15th the Ministry of Finance of Pakistan and National Finance Commission (NFC) held a joint working meeting in Islamabad, in which they discussed potential changes and improvements to Pakistan’s tax system. As an outcome of the meeting, it was agreed that the NFC, the Ministry of Finance, and the Federal Board of Revenue (FBR) of Pakistan would need to improve cooperation and enforce their joint efforts with the aim of increasing the national tax-to-GDP ratio to 15 percent by the end of 2015.

It was agreed that in order to boost national tax collections, Pakistan needs to further broaden its tax system, and tax authorities will now ascertain what changes can be made to the excise tax system, or which duties can be abolished, in order to remove inefficiencies which hinder economic development and bring in only minimal levels of tax revenues.

The FBR also revealed that it is currently compiling a new database of taxpayers, which will contain information that is currently held by different tax authorities and government departments of Pakistan, and will also include data obtained from third parties. It is believed that new data will aid the FBR in its tax investigations, audits and compliance enforcement efforts.

In order to determine what future tax changes would maximize tax revenues and with the aim of ensuring tax efficiency, the FBR is compiling economic data obtained from third parties to ascertain which sectors of the economy are the most active and which are the fastest growing.

Photo by Dave Dugdale

Over the weekend the Civil Recovery Unit (CRU) released its annual report, detailing their efforts to recover properties and funds obtained through criminal and illicit activities in Scotland over the 2011 fiscal year.

According to the report, over 2011 and 2012, the CRU referred 20 cases of large scale tax evasion to the HM Revenue and Customs. The cases are alleged to involve approximately GBP 2 million of unpaid taxes on proceeds from organized crime and money laundering, and recovered GBP 3.5 million in assets and cash.

In the newly published report the CRU noted an increasing number of cases where criminals are attempting to hide their incomes and receives welfare payments from the government. Throughout 2011 and 2012 the CRU recovered over GBP 182 600 in funds that were obtained by criminals committing benefit fraud.

According to law enforcement expert, CRU is increasing its cooperation other government departments and law enforcement agencies in the UK and Scotland in order to collect data and evidence on lawyers and accountants who help facilitate tax evasion and money laundering for organized criminal organizations.

Commenting on the CRU’s results for the year, the solicitor-general of Scotland Lesley Thomason said, “…as important as the sum recovered, is the disruption caused to individual criminals and serious and organised crime groups in Scotland.” Explaining the significance of the CRU’s work, she said, “…when the money and assets go [from the criminals], so does the status and the power.”

The CRU was created in 2003 and works under the Crown Office and Procurator Fiscal Service (COPFS) to ” use civil court proceedings to disrupt crime and to make Scotland a hostile environment for criminals.” With the cooperation of the CRU, in 2011 and 2012 the COPFS recovered an additional GBP 7 million in funds and assets originally derived from criminal activity.

Photo by s_falkow