Fined for GST Tourist Refund Fraud
Two foreigners, a father and his son, were convicted of one GST offence each: Former Research Fellow Zhang Baicheng, aged 33, was convicted of engaging the help of his father, Zhang Yaoqun, a tourist, to claim a GST refund of $247.94 for a $3,790 Prada bag (the “handbag”) that he purchased. Zhang Yaoqun, who was not the purchaser of the handbag, was convicted of claiming GST refunds of $1,791.87 for the handbag, as well as a Tiffany & Co. diamond ring (the “ring”) that was purchased by a then colleague of Zhang Baicheng. The court fined Zhang Baicheng and Zhang Yaoqun (“co-accused persons”) $2,000 and $3,500 respectively. If they default on payment of the fine, they will have to serve 2 weeks’ and 3 weeks’ imprisonment respectively. Facts of the Case Investigations revealed that Zhang Baicheng procured his father, Zhang Yaoqun, who was a tourist, to obtain a GST refund for a handbag that the former purchased. Zhang Yaoqun was not entitled to the GST refund as he was not the purchaser of the handbag. Zhang Baicheng did not qualify for a GST refund under the Electronic Tourist Refund Scheme (“eTRS”) as he was employed in Singapore then. Zhang Baicheng’s colleague, Bai Jiaming, who purchased a ring, did not qualify for a GST refund as he was also employed in Singapore. However, Zhang Baicheng assisted Bai Jiaming in procuring Zhang Yaoqun to obtain a GST refund for the ring. Similarly, Zhang Yaoqun was not entitled to the GST refund as he was not the purchaser of the ring. On 11 Mar 2017, the co-accused persons went to the Singapore Changi International Airport to check in for their flight to Bangkok and entered the transit area. Thereafter, Zhang Yaoqun made the GST refund claim for the handbag and the ring at the transit area in Changi International Airport, Terminal 3. Zhang Baicheng, aged 33, was today convicted of engaging the help of his father, Zhang Yaoqun, a tourist, to claim a GST refund of $247.94 for the handbag. Zhang Yaoqun, who was not the purchaser of the handbag and the ring, was today convicted of claiming GST refunds of $1,791.87 for the handbag and the ring. For engaging the help of a tourist to claim a GST refund, Bai Jiaming was charged and convicted on 9 Oct 2017 for his offence. He was also convicted of the offence of receiving the handbag and ring from Zhang Yaoqun after Zhang Yaoqun had obtained approval for a GST refund on the said goods. Penalties for Tourist Refund Fraud The Inland Revenue Authority of Singapore (IRAS) takes a serious view of anyone who makes false declarations to seek GST refunds under the tourist refund scheme and abuses the scheme. Under the GST General Regulations, a person commits an offence for receiving goods from a tourist, directly or indirectly, knowing that the tourist has obtained approval for the refund. The person also commits an offence for engaging another person to seek or obtain an approval for a refund under the tourist refund scheme. Offenders shall be liable on conviction to a fine not exceeding $5,000 and in default of payment to an imprisonment for a term not exceeding 6 months. IRAS will not hesitate to take firm action against retailers who are complicit or negligent in the issuing of eTRS tickets leading to the abuse of the Tourist Refund Scheme.
Source: IRAS, 21 Dec 2017