GST evasion: Firm ordered to pay more than $170,000

GST evasion: Firm ordered to pay more than $170,000

SINGAPORE - Door and window manufacturer Creative Engineering Works has been ordered to pay more than $170,000 in taxes and penalties for failing to register for goods and services tax (GST).

It is the second company to be charged in court for the offence this year, the Inland Revenue Authority of Singapore (Iras) said in a statement yesterday.

Registration is compulsory for any firm with a turnover of more than $1 million.

The company owes $154,535 in GST from the period between June 2006 and Dec 31, 2008 that it had not accounted for, after failing to notify Iras it had become liable for registration.

On top of this sum, it was also ordered to pay a penalty of 10 per cent of that amount, plus a $5,500 fine.

Investigations showed that the total value of all the firm's taxable supplies made for the four quarters ending on March 31, 2006 exceeded $1 million.

This meant Creative Engineering Works was required to notify the Comptroller of Goods and Services Tax of its liability to register for GST by April 30, 2006 - or 30 days later. But it failed to do this.

Furthermore, Iras added, the firm had deliberately cancelled genuine invoices amounting to almost $600,000 to avoid registering.

Therefore, Creative Engineering Works became liable to account for tax totalling $154,535. It should have collected this from its customers if it had promptly registered for GST.

The company could not be contacted for comment.

Two weeks ago, Iras said sports and concerts event firm Midas Promotions had been ordered to pay almost $800,000 in taxes, penalties and fines for the same offence.

Firms which fail to register for GST can be fined up to $10,000 and ordered to pay a penalty of 10 per cent of the tax due from the effective date of registration.

This article was published on April 12 in The Straits Times.

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