Travel ban for GST abuse proposed

People who wrongfully claim refunds of goods and services tax (GST) meant for tourists will be barred from leaving Singapore, under proposed changes to the law.

Only eligible tourists can claim a GST refund for goods bought in and taken out of Singapore.

But some people, such as permanent residents and foreigners on work permits have made such claims and they would be allowed to leave the country only after repaying the wrongly claimed sum.

This move under the GST (Amendment) Bill expands the Comptroller of GST's powers to impose travel restriction orders on those who make wrongful tourist refund tax claims.

The Bill is among three new ones tabled in Parliament yesterday.

A Ministry of Finance spokesman said the change would "not affect the local tourism industry, as genuine tourists remain eligible to claim the GST refunds and will not be affected by the change".

Under the Income Tax (Amendment) Bill, Singapore companies will get government help for mergers and acquisitions as the scheme, which would have ended last year, will be extended for five years to March 31, 2020.

The Bill, with 38 proposed changes, will also raise the amount of allowance a company can claim - from 5 per cent to 25 per cent of the value of the acquisition or merger, capped at $20 million.

The changes are "to provide more meaningful support for companies, especially small- and medium-sized enterprises, which typically conduct smaller deals", said the Inland Revenue Authority of Singapore.

Another change grants tax exemption to withdrawals of up to $400,000 from the Supplementary Retirement Scheme, on the death or terminal illness of the member.

The third Bill will empower the Monetary Authority of Singapore (MAS), among other things, to require foreign banks to locally incorporate all or part of their banking business, if deemed necessary.

The Banking (Amendment) Act also allows MAS to remove key appointment holders of banks if they are found to be unfit. The aim of the Bill is to improve prudential safeguards, corporate governance and risk management controls in the banking industry, said the MAS.

This article was first published on Jan 26, 2016.
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