Mobile phone seller first to be fined for failing to register GST for online sales
File photo of the State Courts in Singapore. (Photo: CNA/Jeremy Long)
SINGAPORE: A mobile phone seller is the first to be fined for failing to register for Goods and Services Tax (GST) for online sales.
Edwin Pang Chung Jie, 40, was given a fine of S$4,000 and a penalty of S$11,802.32 on Friday (Nov 27) for one count under the Goods and Services Tax Act, with another four charges taken into consideration.
He paid the total sum of S$15,802.30.
The court heard that Pang sold mobile phones and related accessories through his businesses Edmobile and Moogi, on platforms like Lazada, Shopee, Qoo10 and Carousell.
The total value of his taxable supplies between December 2012 and September 2013 exceeded S$1 million, which made him liable to be registered under the GST Act.
However, he failed to do so and this resulted in him owing S$118,023 worth of tax for that period.
He also submitted incorrect income tax returns without reasonable excuse and failed to keep proper records of invoices received for his sole-proprietorships.
For failing to notify the Comptroller of GST of his liability to be registered under the Act, the penalties are 10 per cent of the tax due, a fine of up to S$10,000, or a further penalty of S$50 for every day during which the offence continues after conviction.
Between 2015 and 2019, the Inland Revenue Authority of Singapore (IRAS) said it recovered more than S$3.8 million in taxes and penalties from 65 audit cases on taxpayers who operate online businesses.
IRAS said all income from online and e-commerce businesses in Singapore must be reported for tax purposes, like regular brick-and-mortar shops.
Individuals, sole proprietors or partners of a partnership who receive more than S$6,000 in annual net business income this year will be required to file a tax return for the Year of Assessment 2021.
READ: More power for taxman to seize goods for investigations among changes to GST Act
Those who work for an employer but separately earn additional income from an online business must also declare it under the "Trade, Business, Profession or Vocation" section in their individual income tax return.
Online business income that must be reported include sales of goods on e-commerce websites and social media platforms, advertising revenue through video channels, social media posts or blogging, commissions from promoting a company's products or services and digital services such as graphic design and online tutoring.
IRAS said at Pang's charging that it takes a serious view of non-compliance and tax evasion.
"There will be severe penalties for those who wilfully evade tax. The authority will not hesitate to bring offenders to court. Offenders may face a penalty of up to four times the amount of tax evaded. Jail terms may also be imposed," it said.
