Customs fines and warnings on the increase

SINGAPORE - Singapore Customs issued twice as many warnings and fines last year compared with 2012, to people who did not declare goods bought overseas that are liable to be taxed here.

It handed out 398 warnings and fines known as composition sums last year to people who did not declare goods bought abroad with values exceeding the goods and services tax (GST) relief amounts of $150 and $600. In 2012, there were 179 cases.

The number of cases include first-time and repeat offenders and items found at land, air and sea checkpoints.

On Tuesday, The Straits Times ran a story that reminded Singaporeans to pay GST on their overseas shopping.

All goods, including souvenirs, gifts and products for personal use, brought into Singapore are subject to 7 per cent GST.

The story went viral online, with many readers expressing surprise that the rule existed, and some questioning the "low threshold" of $600.

In response, Singapore Customs said the policy of imposing GST on goods brought into Singapore is not new.

It has been in force since April 1, 1994, when GST was first implemented in Singapore. The practice of imposing GST on imports is found in all countries with GST or value-added-tax systems.

Under the rules, if a traveller is out of Singapore for less than 48 hours, he does not have to pay GST on goods valued below $150. If he is out of the country for more than 48 hours, goods valued up to $600 are exempt from GST.

This is double the previous relief amount of $300, which was increased in 2012 to keep pace with rising expenditures.

On arrival, travellers carrying products exceeding the GST relief or duty-free allowance are required to declare the goods at the Red Channel.

They can pay tax at the Singapore Customs tax payment office or at the self-service tax payment kiosk at checkpoints.

Failure to declare the value of purchases is an offence under the Customs Act and the GST Act. Offenders can be prosecuted in court and fined up to $10,000 and jailed for up to three years.

A Singapore Customs spokesman said that GST is applicable for items brought into the country even if foreign sales tax was paid on them, as they will be used here.

If receipts are not available, the value of goods will be assessed based on that of identical or similar goods, he added.

Mrs Abigail Tan, who works in the finance industry, said she had not heard of such a rule.

"I got a shock when I read the news. That makes going overseas to shop quite pointless," said the 27-year-old, who bought a bag for a few thousand dollars on a holiday in Europe this month.

She saved nearly $1,000 by buying the bag abroad because of overseas tax rebates. But she said: "I probably wouldn't spend more than $600 from now onwards on my next trips because of the risk involved.

This article was first published on May 31, 2014.
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