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Singapore

Drop in FY2020/21 tax revenue due to COVID-19 pandemic: IRAS

SINGAPORE: The Inland Revenue Authority of Singapore (IRAS) collected S$49.6 billion in tax revenue in the financial year 2020/21, 7.3 per cent lower than the previous year.

The decline was due to “dampened business activities amidst the COVID-19 pandemic in Singapore”, the authority said in a news release on Thursday (Sep 2).

The tax revenue amount represents 73.6 per cent of the government operating revenue and 10.6 per cent of Singapore’s gross domestic product.

Current year arrears for income tax, goods and services tax (GST) and property tax also fell, from S$357 million the year before to S$323.8 million.

Total income taxes - which comprise corporate income tax, individual income tax and withholding tax - made up 62 per cent of IRAS’ collection, it said in the release.

Income taxes collected in the financial year 2020/21 totalled S$30.5 billion, 0.9 per cent lower than the S$30.8 billion collected in financial year 2019/20.

Corporate income tax collection fell 3.7 per cent from the previous year to S$16.1 billion, while individual income tax collection inched up 3 per cent to S$12.8 billion.

Collection for both GST and property tax fell – by 7.3 per cent to S$10.3 billion and by 34.3 per cent to S$3.1 billion respectively. Stamp duty collection also dropped to S$3.9 billion, which was 7.2 per cent lower than the previous year.

Betting taxes – comprising betting duty, casino tax and private lotteries duty – totalled S$1.7 billion, a 34.3 per cent decline.

"The fall in collections for corporate income and property taxes were mainly due to the implementation of support measures for businesses such as tax rebates," IRAS said.

"In addition, GST, stamp duty and betting taxes collections were lower on account of weaker economic conditions and circuit breaking measures put in place during the year," it added.

The agency also provided measures to support businesses and individuals amid the disruptions caused by the COVID-19 pandemic.

This included corporate and property tax rebates, extension of tax filing deadlines, deferment of income tax payments and instalment payments to ease cashflow for affected taxpayers.

“Since last year, IRAS has also stepped up to its new role as the Centre of Excellence for disbursing national grants to enterprises – the Wage Credit Scheme, Jobs Support Scheme, Government Cash Grant and Jobs Growth Incentive,” it said.

A total of S$28.2 billion of grants were disbursed in the financial year 2020/21 to support jobs and businesses through the pandemic.

NEW DIGITAL INITIATIVES

IRAS has also continued with its digitalisation efforts, by introducing several new initiatives to make tax filing and payment easier.

This includes the introduction of a consolidated property tax bill for taxpayers who have multiple properties.

Taxpayers would receive a single, consolidated notification via SMS or email when their digital bills are ready for viewing, IRAS said. It also allows them to see an overview of their portfolio of properties and obtain a consolidated summary statement on their myTax portal dashboard.

This has benefited more than 50,000 corporate and individual taxpayers in the last financial year, the authority said. It added that it plans to make further enhancements to enable a consolidated payment of taxes for all properties owned by a taxpayer by the financial year 2023/24.

Other initiatives include a simplified income tax return form for companies with straightforward tax matters, and GST registration alerts built into accounting software.

“IRAS has worked with several software vendors to incorporate GST registration alerts into accounting software,” IRAS said. Businesses that use the feature will get an alert when their total turnover at the end of a calendar year exceeds S$1 million.

This will prompt them to register for GST and help further ease tax compliance for businesses, it added.

“The COVID-19 pandemic did not diminish our drive to provide excellent service and support to taxpayers,” said Mr Ng Wai Choong, Commissioner of Inland Revenue and Chief Executive Officer of IRAS.

“IRAS will continue to leverage data-driven insights, customer-centric service design and partnership with the community to deliver more seamless services to taxpayers.

"We also remain committed in supporting the Government’s efforts to help businesses affected by the pandemic and save jobs.”

Source: CNA/ga(gr)

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