SINGAPORE - A director of Robofusion Asia, which supplies robotic ice-cream machines, was sentenced to six weeks' jail on Thursday (July 6) after he was convicted of evading the Goods and Services Tax (GST) by overstating GST input tax on his company's GST return.
American Robert Taramelli S, 44, was also ordered to pay a penalty of $107,004, which is three times of the GST input tax of $35,668.
Both he and Robofusion, which was fined $8,000 and ordered to pay the same amount as penalty, were found guilty after a five-day trial.
They are appealing against conviction and the sentences. Their counsel is Mr Jonathan Wong.
Taramelli was convicted of helping Robofusion to evade tax by keeping a false record by including a false invoice he had created, purportedly from Denso International Asia showing GST amounting to $35,668, into Robofusion's taxable purchases listing.
He included the GST figure from the false invoice in the amount of input tax claimed in the company's GST return for the accounting period Sept 1 to 30, 2013.
The false invoice was for the supposed purchase of 10 machines by Robofusion from the supplier for $509,541.
Investigations showed that the actual tax invoice had been claimed in Robofusion's GST return for an earlier accounting period in June that year.
The GST charged and collected from customers is known s output tax, which has to be accounted for and paid to the Inland Revenue Authority of Singapore (Iras). GST incurred on taxable business purchases and expenses is known as input tax.
The difference between the output tax and input tax is the net GST payable to or refundable from Iras.
Iras said in a statement on Thursday (July 6) that it detected anomalies in the declarations made by Taramelli in Robofusion's GST returns during its regular audits of GST-registered businesses.
It said it is a serious offence to claim GST input tax on fake purchases or understate output tax on sales.
Offenders face a penalty of three times the amount of tax undercharged, a fine of up to $10,000 and/or a jail term of up to seven years.
Iras senior tax prosecutor Tham Siok Peng had sought a sentence of at least two months' jail to be imposed.
Among the aggravating factors she cited were public interest, the gravity of GST evasion offences and Taramelli's lack of remorse.