SINGAPORE - Advertisements by Singapore customs reminding travellers that they have to pay goods and services tax (GST) for items bought overseas have caused a stir online.
Some expressed surprise. Yet the imposition of GST on goods imported into Singapore is not new. It has been in force since 1994, when GST was introduced, says a Singapore Customs spokesman.
All goods brought into Singapore above the value of $600 per person are subject to 7 per cent GST, including goods bought overseas for personal use.
According to Singapore Customs, there were 179 cases of travellers issued warnings or composition sums in 2012.
Last year, it more than doubled to 398 cases.
We pose some hypothetical scenarios to Singapore Customs:
Scenario 1: I bought a branded bag overseas that costs $2,000. I started using it during the trip. Do I have to pay GST on the excess of the relief on the item?
Answer: Yes. If you have been away from Singapore for longer than 48 hours, the amount payable is 7 per cent of $1,400 ($2,000 less $600), which is $98.
If you were away for less than 48 hours, the GST relief is $150 and the tax payable is 7 per cent of $1,850 ($2,000 less $150), or $129.50.
Scenario 2: I bought a bag on a recent trip and paid GST when I came home. I'm using the same bag for my current trip. Do I have to prove that the bag was bought in a previous trip?
Answer: You may produce the receipt issued by Singapore Customs for your previous GST payment for the bag.
Scenario 3: I bought a bag in Paris, and am in transit to Australia. But I'd like to do a day tour in Singapore. Do I have to pay GST on the item if I exit the checkpoints for a day in Singapore?
Answer: Yes. If the value of the bag exceeds your GST relief and if you choose to bring it with you when you enter Singapore for the day tour. However, if you do not wish to pay the GST, you may deposit your bag at the Airport Left Baggage Service at the Departure Transit area.
Other frequently asked questions
What if I have no receipt for a gift?
Answer: If the receipts are not available, the value of the goods will be assessed based on the values of identical or similar goods when computing the GST payable.
What if I buy a bag from a duty-free shop in Changi Airport on the way out?
Answer: The newly-purchased bag is subject to GST on the return to Singapore, if it exceeds the traveller's GST relief amount.
If I have already paid sales tax for an item overseas and did not claim tax rebate, do I still have to pay GST?
Answer: Yes. GST is applicable for items imported into Singapore regardless of whether foreign sales tax was paid for the items overseas, as the items will be consumed in Singapore.
This article was first published on June 1, 2014.
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