GST charged on value of goods and services

GST charged on value of goods and services

We thank Mr Lo Chock Fei for his feedback ("Direct answers more helpful"; last Saturday).

GST-registered businesses have to charge goods and services tax on the value of their goods and services.

In the case of private clinics, the value of their services is the amount that they charge for the services.

The subsidies under government-funded healthcare schemes are given to individual patients to defray their medical bills, and do not change the value of the services provided by the clinics.

Therefore, the private dental clinic that Mr Pang Kim Phong visited correctly charged GST of $6.20 on the dental fee of $88.5 ("Why no subsidy for GST?"; May 23).

Mr Pang also mentioned that his tax invoice from Singapore General Hospital (SGH) showed that the GST was computed on $27.21, which was the amount payable after a government subsidy of $63.49 ("GST computation not consistent"; May 27).

Public hospitals and polyclinics receive government funding to provide medical services to eligible patients at a lower, subsidised price.

SGH was correct to have computed GST on the subsidised price of $27.21, as this was the value of its services.

Patients in public hospitals and polyclinics who are charged GST on the subsidised price do not pay any GST, as it is absorbed by the Government.

Yvonne Yim (Ms) Manager Corporate Communications Inland Revenue Authority of Singapore

This article was first published on June 10, 2015.
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