10 Common Myths About Basic Understanding of Singapore Goods & Services Tax

Jack Wong HM
9 min readJan 3, 2022

To all my subscribers, Happy New Year!

On the first day of 2022, I understand that you are busy with the New Year’s Celebration with your loved ones.

Instead of writing on the topics about new year’s resolution, how to set your goals in 2022, I have decided to write my newsletter on this topic because of a call I received from my contact on New Year’s Eve about her liability to register for Singapore Goods & Services Tax (GST). After discussing her situation in 2021, I advised her to register for GST with the Singapore tax authorities, and the deadline for her is 31 January 2022.

Do you agree that it’s the first day of 2022, and yet, there’s not much time left?

With that in mind, I would like to devote the topic “Common Myths About Singapore GST” to this newsletter and trust that it would give you some insights into the complexity of this tax.

Let’s Go Back to 2018

Singapore introduced GST on 1 April 1994, starting from 3% then to 7% now. Our GST law is heavily modeled the UK Value Added Tax and the GST Law in New Zealand if you are interested in the history.

In the Budget 2018, the former Finance Minister, Heng Swee Keat, first mentioned raising the GST rate. This was what he said in his Budget Speech:

“a. This GST increase is necessary because even after exploring various options to manage our future expenditures through prudent spending, saving, and borrowing for infrastructure, there is still a gap. b. Increasing GST by two percentage points will provide us with almost 0.7% of GDP per year. To support these recurrent needs, the Government plans to raise GST by two percentage points, from 7% to 9%, sometime in 2021 to 2025. The exact timing will depend on the state of the economy, how much our expenditures grow, and how buoyant our existing taxes are. But I expect we will need to do so earlier rather than later in the period.

c. This boost in revenue will be vital in closing this gap. We will continue to manage our expenditures and the need for other future revenue measures carefully and plan early for our overall revenue and expenditure needs.

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Jack Wong HM

Prof Wong teaches International Tax & Tax Planning in SG & consults in taxation & business matters. He writes on business topics, tax updates, & mindset stuff.