Man jailed and fined more than S$4 million for evading GST on imported goods, falsifying documents

SINGAPORE — The sole director of a freight forwarding company was jailed and fined more than S$4 million on Thursday (June 23) for evading Goods and Services Tax (GST) and falsifying documents.

Ho Shyan Tien, a Singaporean, committed those acts on 632 occasions between 2015 and 2019 by providing false values of goods imported by his customers to a declaring agent, said Singapore Customs on Friday.

The total amount of GST evaded amounted to about S$1,252,100.18.

The 44-year-old director of Sea-Net Cargo Express (S) pleaded guilty to three charges of fraudulent evasion of GST involving 327 fake invoices and another three for falsifying documents. Another six charges were taken into consideration during the sentencing.

He was sentenced to eight months’ imprisonment and fined a total of S$4,419,000.

UNDERPAYMENT OF GST

In June 2019, Inland Revenue Authority of Singapore (IRAS) found discrepancies in the cargo clearance permits (CCP) during a check on the GST return submission made by one of Ho’s customers, who is an importer.

CCPs are required to account for the import and tax payment of the goods, and a declaration must be made to Singapore Customs electronically to obtain a permit. The GST payable would then be paid to the State.

After discovering the discrepancies, IRAS sought Singapore Customs’ assistance to verify the GST amount paid by the importer.

“It was found that the GST amounts stated in the importer’s copy of the CCP were higher than what was in Singapore Customs’ records. Further verification with the importer showed that the importer had paid the GST amounts reflected in their copy of the CCP,” said the Customs.

Singapore Customs’ investigations into Sea-Net showed that Ho had masked the original values in the commercial invoices from his customers by pasting altered values over them.

He then photocopied the falsified invoices and provided them to a declaring agent to apply for a cargo clearance permit.

“There were also occasions where Ho received commercial invoices from customers in an editable document, which allowed him to amend the values directly,” said Singapore Customs.

The declaring agent would proceed to pay Customs the GST based on the documents from Sea-Net and bill the company the amount of GST paid.

Once the cargo clearance permit was approved, the agent would send the permit to Sea-Net.

“Ho’s actions resulted in the under-declaration of the values of the goods and underpayment of GST to Singapore Customs,” said the agency.

To conceal his scheme, Ho altered the values and GST amounts stated in the approved permits before providing them to his customers.

“This gave his customers the impression that the correct GST amounts were paid to Singapore Customs,” the agency said.

Ho would then profit from the difference between the GST amount collected from his customers and the lower GST amount paid through the declaring agent.

Singapore Customs advises importers to check the declarations to the agency made on their behalf by their freight forwarders or declaring agents using their Unique Entity Number (UEN).

“To safeguard themselves against frauds, traders may wish to sign up for the trader notification service to receive notifications relating to permit declarations made using their UEN. The notifications include information on the total amount of duty and/or GST payable,” said Singapore Customs.

“Any person who is in any way concerned in any fraudulent evasion of, or attempt to fraudulently evade, any duty shall be guilty of an offence and will be liable on conviction to a fine of up to 20 times the amount of duty and GST evaded,” said the Customs, adding that falsifying documents is a serious offence.

Offenders can be fined up to S$10,000 and/or jailed up to 12 months.