Trust Bloomberg BNA's Premier International Tax offering for the news and guidance to navigate the complex tax treaty networks and business regulations.
By Ben Stupples
Oct. 18 — Singapore’s tax authority has said it will increase the number of the audits it carries out on large companies over the next two years to improve their compliance with the country’s goods and services tax.
The Inland Revenue Authority of Singapore will focus on how large businesses implement the consumption tax through their display of prices to the public, including plans for on-site inspections.
“In the next two years, IRAS will step up audits on large businesses and checks on businesses’ display of GST-inclusive prices to the public,” IRAS said in an Oct. 14 web post. Most cases of non-compliance with GST “arise from negligence or insufficient understanding of tax matters,” it added.
Receipts from GST—a self-assessed tax levied on the import of goods, as well as nearly all supplies of goods and services in Singapore—make up almost a quarter of the Singapore government’s total tax collection, according to data compiled by Bloomberg BNA. Large businesses form just 2 percent of Singapore’s GST tax base, but they contribute more than 50 percent of the total GST paid to IRAS.
For the year ending March 31, 2016, the IRAS received more than S$10.3 billion ($7.2 billion) from Singapore businesses, with most of the receipts for the tax coming from the country’s wholesale and retail, real estate and construction sectors, according to data published by the IRAS.
Any GST errors or omissions discovered through the IRAS’s audits of Singapore’s large businesses will result in penalties of up to double the tax owed and a 5 percent penalty late payment, IRAS said Oct. 14. The high value and size of large businesses’ transactions contribute to an increased risk of GST errors, especially if their methods for tax classification and capturing GST are not “robust,” it added.
Since April last year, Singapore businesses have had to display prices that include the 7 percent GST tax as prominently as any prices that exclude it. Displaying only prices that exclude GST can result in a fine of 5,000 Singapore dollars and imprisonment for as long as six months, according to the IRAS.
Over the past three years, the IRAS has penalized or issued letters of warning to more than 85 businesses for failing to display prices that include GST, which was introduced in April 1994.
Any Singapore businesses with a taxable turnover of more than 1 million Singapore dollars over the past 12 months, or any businesses that expects to make the same amount in the same 12-month time frame, must register with the IRAS for GST. An IRAS spokesperson was unavailable for comment.
To contact the reporter on this story: Ben Stupples in London at email@example.com
To contact the editor responsible for this story: Rita McWilliams at firstname.lastname@example.org
Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)