Ice-cream machine supplier fined for false tax claim

SINGAPORE — A company that supplies robot-operated ice-cream kiosks was yesterday convicted of submitting false information to the Inland Revenue Authority of Singapore (Iras) when making a claim for its spending.

Robofusion Asia, which set up its first automated ice-cream machine in Singapore in 2013 at City Square Mall and later at the Science Centre, gave false information in a form when applying for claims under the Productivity and Innovation Credit (PIC) scheme. The scheme gives tax deductions or cash payouts to businesses for investments to boost productivity, such as for automation and training purposes.

Its director Yong Tai Kok, 44, has also been convicted of his role in intentionally helping the company “without reasonable excuse” to make the false claim, the Iras said in a press release yesterday.

The company, which pleaded guilty through Yong, was fined S$60,000.

Yong was fined S$4,000 and was ordered to pay a penalty of S$120,000, calculated as twice the amount of cash payout wrongfully claimed.

On May 23, 2013, Robofusion falsely stated in the form that Mr Mark Lim Xian Yu and Mr Tay Hui Jie were their employees from Singapore when they were not. Businesses must hire at least three employees who are Singaporeans or permanent residents before they are eligible to apply for the payout.

Yong got the consent of the two parties to use their names, and Robofusion made contributions to their Central Provident Fund accounts, in order to represent them as its employees here.

The firm then made the claim for buying a Robofusion Generation 4 ice-cream kiosk that cost S$93,000 in February that year, and for spending S$14,980 two months later to get a software licence and implementing a “cashless payment system and kiosk payment integration”, Iras said.

The company thus wrongfully claimed S$60,000 as cash payout through the scheme, since it did not meet the condition of having at least three resident employees.

Introduced in 2010, the PIC scheme allows a company to claim cash rebates of up to 60 per cent for qualifying expenditure. It was later extended to run until 2018. In August last year, the cash payout rate was reduced from 60 to 40 per cent.

The authority said: “Iras takes a serious view of any attempt by claimants, vendors or consultants to defraud the Government.”

Businesses or individuals are encouraged to immediately disclose any past tax mistakes. The authority said that it would treat such disclosures as mitigating factors when considering action to be taken. Those who wish to disclose past mistakes, reveal evaded taxes, or report malpractices that might indicate tax evasion may write to Iras or email ifd [at] iras.gov.sg.

Offenders convicted of PIC fraud will have to pay a penalty of up to four times the amount of cash payout fraudulently obtained, and a fine of up to S$50,000 and/or be jailed up to five years.