The Ministry of Finance (MOF) wants feedback on proposed changes to the Goods and Services Tax (GST) Act, including plans to exempt the sale and transfer of digital payment tokens from the tax.
It said this will more accurately reflect the characteristics of such tokens, which are commonly known as virtual currencies. The change will also ensure GST rules remain relevant in the digital economy.
The MOF added that rules in other jurisdictions such as Australia, the European Union, Japan and Switzerland have been similarly updated in recent years.
The sale and transfer of virtual currencies are now considered to be supplies of services and thus subject to GST.
Other changes are being mooted as well, two relating to the planned introduction of GST on imported services from January next year.
The first seeks to clarify and improve GST administration for imported services. This includes clarifying the scope of the reverse charge system for business-to-business services. Under this system, local GST-registered businesses have to collect GST for services that they import, rather than having service providers do so.
The MOF is also recommending changes to how tax proceedings in the High Court and Court of Appeal are heard.
Cases are now heard in private by default and taxpayers’ names in published decisions are redacted. The MOF has proposed that both practices be discontinued “to align with the principle of open justice and in keeping with international trends”.
The ministry also proposes allowing GST group registration for overseas businesses under the overseas vendor registration regime.
A second proposal is to introduce an offence for misrepresentation of information, as suppliers under the overseas vendor registration regime rely on declarations made by customers to determine if the tax is applicable.
This amendment is required for the Inland Revenue Authority of Singapore to effectively enforce GST on imported services, the MOF said.
It is also recommending changes to how tax proceedings in the High Court and Court of Appeal are heard.
Cases are now heard in private by default and taxpayers’ names in published decisions are redacted.
The MOF has proposed that both practices be discontinued “to align with the principle of open justice and in keeping with international trends in Canada, Hong Kong, New Zealand and the United Kingdom”.
It is also proposing to introduce definitions of “accountant” and “advocate and solicitor” for the purposes of appeals to the GST Board of Review.
Those interested can download detailed consultation documents for the draft GST (Amendment) Bill on the MOF website or on government feedback portal Reach.
Feedback can be e-mailed to pc_gstabill@mof.gov.sg, faxed to 6337-4134 or sent to the ministry by post.