- POSTED: 17 Sep 2013 00:45
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The government is prepared to work with the National Taxi Association and taxi operators to explore if there are other options which could improve the taxi drivers' recovery of their GST costs.
SINGAPORE: The government is prepared to work with the National Taxi Association and taxi operators to explore if there are other options which could improve the taxi drivers' recovery of their GST costs.
Senior Minister of State for Finance and Transport Josephine Teo replied in Parliament on Monday to MP for Ang Mo Kio GRC Ang Hin Kee who asked if the Finance Ministry would consider a review or removal of GST, which is currently levied on the daily rental of taxis.
Mrs Teo said the GST system was designed to be broad based with few exemptions to keep the GST rate low.
She said: "Traders generally meet their GST costs from their earnings. Alternatively, they could register for GST, which would allow them to charge customers for GST and claim GST cost.
"It is understandable that taxi drivers may not find it worthwhile to be GST registered, especially as fares are set by the taxi operators."
Mr Ang, who is also Advisor to the National Taxi Association, pointed out there is also a S$5,100 diesel tax levy that is levied a year on taxis using diesel.
He said over the years, taxis have moved towards a Euro 4 or 5 standard which is less polluting and suggested the levy on older diesel vehicles be reviewed as there are better models on the road to further lower costs for taxi drivers.
To this, Mrs Teo said the annual special tax levied on diesel taxis is imposed because there isn't a unit tax imposed on diesel fuel and and that it is already a concession.
She added if an equivalent volumetric tax like the one imposed on a petrol driven car is levied, it would incur a higher tax.
Mrs Teo also pointed out that the special tax on taxis has also remained unchanged since 1998, though temporarily reduced in 2001 and 2003 for recessionary measures.