SINGAPORE - Concert promoter LAMC Productions, which brought stars such as Lady Gaga, Pussycat Dolls and Dionne Warwick to Singapore, has been ordered to pay $281,212 for failing to declare and pay tax set aside from the performers' fees.
The sum comprises a penalty of $256,212 - three times the tax due - plus a fine of $25,000.
Under the Income Tax Act, an events company must withhold tax on payments to non-resident entertainers, then notify and forward the withheld tax to the Comptroller of Income Tax.
LAMC entered into five contracts with the management company for the stars who performed here in concerts in 2008 and 2009, but failed to declare and pay the tax withheld. The five concerts featured Stereophonics, Pussycat Dolls, Lady Gaga, Keane and Dionne Warwick. The contract fee for Pussycat Dolls was US$150,000 (S$208,400) and Lady Gaga half that sum, while the fees for Dionne Warwick and Keane were US$50,000 each. Stereophonics were paid US$33,500, but the sum withheld was US$1,500 when it should have been US$4,565 at the requisite 15 per cent tax.
This is the first time a company has been prosecuted and convicted of this offence.
The Inland Revenue Authority of Singapore (Iras) said that LAMC directors James Knudson and Lauretta Alabons had been previously advised on how to calculate the tax to be withheld before informing and paying the authorities.
It said it takes a serious view of non-compliance and tax evasion. Urging individuals and businesses to disclose any past tax mistakes, it said: "Iras will treat such disclosures as mitigating factors when considering action to be taken."
Those who wish to own up or report malpractices indicating tax evasion may e-mail the taxman at firstname.lastname@example.org or write to Iras.
This article was first published on March 15, 2015.
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