SINGAPORE - Trained tax investigators will have the power to arrest an individual without warrant under proposed changes to the Income Tax Act.

These investigators will also be allowed to conduct a forced entry and perform a body search under certain conditions.

The proposed changes will give the Inland Revenue Authority of Singapore (Iras) more powers to investigate specified serious tax crimes, or where the suspect attempts to destroy evidence.

Serious tax crimes include fraud and tax evasion.

The Ministry of Finance (MOF) said these powers will only be exercised where necessary so that investigations into serious tax crimes are not impeded. This might include when documents are destroyed or an attempt is made to destroy documents.

"The legislative amendment will provide that the arrest powers are to apply where the arresting officer has reason to believe that the act (destroying a document) is done with a view to hinder or obstruct an Iras investigator in the exercise of his powers," the ministry said in a statement.

The Income Tax (Amendment) Bill was introduced in Parliament on Monday (Sept 10).

In a statement in June, MOF said changes were needed as syndicates and recalcitrant taxpayers were employing more sophisticated strategies for tax fraud.

"When investigated, these suspects may refuse to cooperate with Iras' investigation. For instance, they may refuse to hand over potential evidence, attempt to destroy evidence, or may contact other suspects to corroborate statements.

"Such acts of non-cooperation affect Iras' effectiveness in bringing the perpetrators to justice."

Under the proposed changes, Iras' powers will also be expanded to allow it to gather information relevant to its investigations from any person.

For those who obstruct officers doing their duty, the penalties imposed will be aligned with those under the Goods and Services Tax Act.

These penalties are a fine not exceeding $10,000 or imprisonment for a term not exceeding 12 months, or both.

In addition, the Iras will also be allowed to share information with law enforcement agencies to combat serious crimes.

Currently, the authority is allowed to provide information to law enforcement agencies under limited circumstances, for example when a Court Order is issued.

Following public feedback, the ministry said the arresting powers of designated trained tax investigators will be limited, to prevent abuse of powers on innocent individuals.

There will also be clear guidelines and operational protocols on situations which allow the exercise of these enforcement powers.

"The training of tax investigators, guidelines and protocols will be consistent with those in other law enforcement agencies," said the ministry.

In total, the public sent in 100 suggestions from June 20 to July 11 this year and 37 were accepted, with revisions to the draft made accordingly.

One suggestion that was rejected was a proposal to give taxpayers the right to be notified once their information has been shared.

The ministry said the suggestion was not accepted because the proposed change related to the sharing of information is intended to allow Iras to divulge information that it assesses as necessary for investigation or prosecution of serious crimes only.

"Such serious crimes include drug dealing and corruption.

"Notifying the taxpayer of the information shared or how information may be shared will alert potential suspects on ongoing investigations into serious crimes, thereby prejudicing the investigations," the ministry added.