Source: Google Map screengrab.

IRAS: $50.2 billion in tax revenue collected in Financial Year 17/18

$50.2 billion in tax revenue was collected in Financial Year (FY) 2017/18, marking an increase of 6.8 percent from the previous FY and came on the back of better-than-expected economic expansion of 3.6 percent in 2017.

In a press release on Wednesday (26 September), the Inland Revenue Authority of Singapore (IRAS) shared that the increase in revenue collection was attributed mainly to higher Corporate Income Tax collection from improved corporate earnings; and higher Stamp Duty collection due to a higher number of property transactions. The cost of tax collection remained low at 0.84 cents for every dollar collected.

IRAS stated that its collection of $50.2 billion in FY2017/18 represents 66.2 percent of the Government Operating Revenue and 11.1 percent of Singapore’s Gross Domestic Product.

Income Tax (Corporate Income Tax, Individual Income Tax and Withholding Tax) made up 54 percent of IRAS’ collection in FY2017/18, similar to the previous financial year.

Total income taxes collected were $27.2 billion, 6.3 percent higher as compared to $25.6 billion in FY2016/17. The increase was attributed to higher Corporate Income Tax collection – up from last FY’s $13.6 billion to FY2017/18’s $15.0 billion –  due to improved corporate earnings.

GST collection was $11.0 billion in FY2017/18, similar to FY2016/17.

FY2017/18 Property Tax collection was consistent with FY2016/17, at $4.4 billion. Stamp Duty collection for FY2017/18 increased by 49.6 percent to $4.9 billion due to a higher number of property transactions.

Meanwhile, $2.7 billion of Betting Taxes, comprising Betting Duty, Casino Tax and Private Lotteries Duty, were collected in FY2017/18, unchanged from the previous year.

Source: IRAS.

Marking IRAS’ 25th anniversary as a statutory board in 2017, the organisation pressed ahead with its transformation movement to redefine taxpayers’ experiences by LEveraging Analytics, Design and Digitalisation (LEA:D).

“IRAS has quickened the pace of transformation. Taxpayers benefited from more digital initiatives that provided greater convenience, and made filing, payment, and compliance easier.  Online tools such as a Virtual Assistant and an interactive start-up kit for new companies, provide quick answers to taxpayers.  We will continue to engage stakeholders to improve tax services,” said Mr. Ng Wai Choong, Commissioner of Inland Revenue/Chief Executive Officer.

In line with the Smart Nation push for e-payment and to provide greater taxpayer convenience, IRAS noted that it was the first organisation to partner OCBC Bank to leverage Application Programming Interface (“API”) for online application of GIRO.

With this service at myTax Portal since November 2017, taxpayers no longer need to submit paper forms. The GIRO facility can be set up instantaneously. We will be collaborating with other banks to extend this service to their customers.

It also mentioned other services rolled out in FY2017/18 for taxpayer-centred experiences were:

Other Services rolled out

The authority then noted that most taxpayers are voluntarily compliant as IRAS makes it easy for them to file and pay their taxes:

On-Time Filing Results

“We continued to take firm actions against non-compliance. We audited and investigated 10,726 taxpayers and recovered approximately $384 million in taxes and penalties in FY2017/18,” the authority added.

The authority then stressed that Singapore is fully committed to the international standards on tax cooperation.

In 2017, Singapore signed two international agreements to facilitate sharing of tax information across borders – the Multilateral Competent Authority Agreement (MCAA) on the Automatic Exchange of Financial Account Information under the Common Reporting Standard (CRS), and the MCAA on the Exchange of Country-by-Country Reports (CbCR).

As of March 2018, Singapore has established a total of 62 Automatic Exchange of Information (AEOI) relationships for CRS purposes, and 53 AEOI relationships for CbCR purposes.

In line with the fast development of the digital economy, IRAS added that it will be introducing GST on imported digital services with effect from 1 Jan 2020, to ensure that all services consumed in Singapore, whether purchased locally or abroad, are subject to the same GST treatment.

About 850 businesses and associations have been consulted in the design of the GST measures, it noted.