Singapore Court Puts Manager of IT Equipment Trader Behind Bars for GST Fraud

Samuel Sim Choon Hock, a manager of Netlink Alliance Pte Ltd, was sentenced by the Singapore court to 18 weeks' jail after pleading guilty to 8 charges of making fraudulent GST claims.

He was also ordered to pay a penalty of $183,925.62, which is three times the amount of fictitious claims for GST refunds of $61,308.54 that he had made in the company's GST returns.

Netlink, a GST-registered company, is in the business of import and export of IT equipment. IRAS' investigations revealed that Sim inflated the input tax claims and understated output tax on sales in the company's GST returns from Feb 2006 to Jul 2008.

Sim faced 24 charges of making fraudulent GST claims amounting to a total of $116,558.04. He had used the money to pay for his personal and family expenses. Sim pleaded guilty to 8 charges.

The remaining 16 charges were taken into consideration in the sentencing as Sim was cooperative during the investigation process.

GST-registered businesses offset the GST they pay for their purchases (input tax) against the GST they collect from sales (output tax), and pay the net difference to IRAS.

If the business incurs more GST on purchases (input tax) than it collects from sales (output tax), it can claim the difference from IRAS in the form of GST refunds.

IRAS conducts audits on businesses and uses data analytics tools to detect anomalies in the input tax and output tax claims of GST-registered businesses. This case was uncovered in one of such audit programmes.

In Singapore, it is a serious offence to claim input tax on fictitious purchases or understate output tax on sales. Offenders face a penalty of up to 3 times the amount of tax undercharged, a fine not exceeding $10,000, and/or imprisonment of up to 7 years.
 

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