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No review of GST 'anomaly' at airport

Items bought upon departure not taxed when brought in later

Published on Mar 23, 2013 10:44 AM
 
A "No GST" sign at a perfumes and cosmetics store in the Changi Airport Terminal 3 Departure Hall. A traveller does not have to pay the 7 per cent GST for items bought before departure. -- ST FILE PHOTO

The Inland Revenue Authority of Singapore (Iras) is sticking to its guns regarding purchase-on-arrival rules at Changi Airport, despite complaints of an "anomaly" in the goods and services tax (GST).

Currently, if a traveller shops at the airport before getting on a flight, he does not have to pay the 7 per cent GST because the items bought are considered as being exported.

However, if the purchases are made at the airport when the person returns to the Republic, the items become taxable because they are considered to be consumed in Singapore.

This means that technically a passenger can buy a product upon departure, then bring it back to consume - without paying the consumption-based tax.

 
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