Despite slower economic growth, taxpayers have earned and contributed more to the government's coffers in the last financial year. The Inland Revenue Authority of Singapore (IRAS) collected S$44.8 billion in tax revenue for FY15/16 - marking a 3.2 per cent increase year on year, and a new all-time high.
More people made it to the millionaires' club too, with 5,141 taxpayers having an assessable income of more than S$1 million each, up from 4,557 the year before.
The total amount of tax collected accounted for 69.1 per cent of the government's operating revenue and 11.1 per cent of Singapore's GDP, said IRAS in its latest annual report released on Tuesday.
IRAS's collection comprises income tax, goods & services tax (GST), property tax, stamp duty, and betting taxes. Besides these, the government's operating revenue is also made up of customs and excise duties, motor vehicles taxes, vehicle quota premiums, and other fees and charges. Said IRAS: "Tax compliance in Singapore remained high and tax arrears low at 0.62 per cent of net tax assessed. Cost of collection was also kept low at 0.83 Singapore cent for every dollar collected."
Income tax collection - comprising corporate and individual income tax as well as withholding tax - increased 4.4 per cent from FY14/15, and made up 55 per cent of IRAS's collection.
Collections from corporate income tax grew 3.3 per cent to S$13.8 billion, while those from individual income tax rose 3.4 per cent to S$9.2 billion. GST collected represented 23 per cent of the overall pie, and increased marginally to S$10.3 billion for FY15/16 from S$10.2 billion previously. Property tax collection rose 2.7 per cent to S$4.5 billion, stamp duty collection remained flat at S$2.8 billion, and betting taxes collected increased 4.9 per cent to S$2.7 billion.
Peter Ong, who was chairman of IRAS until May 1, said in its annual report: "The Singapore economy grew at a slower pace of 2 per cent in 2015 and our labour market remained tight with low unemployment rate. Our tax revenues stayed healthy, funding the government's programmes to transform the economy and promote an inclusive society."
Using the Productivity and Innovation Credit (PIC) Scheme as an example, Mr Ong said that as at March 31, 2016, more than S$5.8 billion in tax savings, PIC cash payouts, and PIC bonuses have been granted to more than 143,000 companies and businesses. PIC was announced in Budget 2010. He added that in the third tranche of the Wage Credit Scheme - introduced in 2013 to help businesses cope with rising wage costs - 95,000 employers received about S$1.9 billion as at March 31, 2016, with small and medium enterprises (SMEs) receiving about 70 per cent of the sum disbursed.
Mr Ong has stepped down as IRAS chairman; permanent secretary for finance Tan Ching Yee took over as chairman in May.
IRAS said that Singapore taxpayers continued to file and pay on time, "contributing to a 96 per cent high on-time filing rate by individuals, and 82 per cent high on-time filing rate by companies".
In FY15/16, IRAS audited and investigated some 11,450 taxpayers and recovered over S$411 million in taxes and penalties.
This article was first published on Aug 31, 2016.
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