ASEAN Regulatory Brief: Singapore GST Audits, Philippines Dormant Bank Accounts, and Malaysia-China Bilateral Ties

ASEAN Regulatory Brief: Singapore GST Audits, Philippines Dormant Bank Accounts, and Malaysia-China Bilateral Ties

November 9, 2016

Singapore: Tax Authority to Step Up GST Audits

The Inland Revenue Authority of Singapore (IRAS) expressed they will stand up GST audits for big companies in 2016 and 2017. While big companies build only 2 percent of the GST taxpayer base, they contribute more than 50 percent of incomes from GST. Even though big companies have complex business agreements and high-value exchanges, the greater part of them outsource finance functions to areas outside Singapore, which may not be completely agreeable with Singapore’s GST rules, and thus increasing risks of mistake.

Businesses that are found to have discrepancies during the audit will be paid with penalties of up to two times the tax underpaid and a 5 percent late payment fine. The IRAS has urged GST citizens to take an interest in its Assisted Compliance Assurance Program (ACAP) to dodge audit exemption and one-off full waiver of fines. Big businesses working in Singapore, including multinational companies, should guarantee they are consistent with every applicable rules and policies related with GST.

Philippines: Central Bank Tightens Rules on Inactive Deposits

The nation’s national bank Bangko Sentral ng Pilipinas (BSP) has issued new rules on inactive deposit accounts and related expenses charged by banks through Circular 928, which was marked on October 24. According to the new guidelines, banks, non-stock savings and loan associations (NSSLAs) can force up to US$ 0.6 (PHP 30) as a month to month inactivity fee and will require a more drawn out notification procedure before such accounts can be marked as inactive.

The month to month fee must be charged if the there is no deposit or withdrawal from an account for five years, if the deposit is under the base monthly average daily balance and if the depository bank or NSSLA has fulfilled with the notification requirements. The policies apply to retail clients. Banks should inform clients no less than two months ahead of time of the accounts getting to be inactive and before charging an inactive fee. Banks should tell through postal mail, messenger, email, phone or whatever other means. Also, for local remittances, just the sender will be charged transaction fees when contrasted with the past administer where both senders and collectors were charged fees.

Malaysia and China fortify bilateral ties

Malaysia signed 14 Memorandums of Understanding (MoU) in security, economy, agricultural, education, finance and construction segments worth US$ 34 million (RM 143 billion). The MoUs were signed during Malaysian Prime Minister Najib Razak’s visit to Beijing. Among the understandings signed were reestablishment of education cooperation with China, a financial related concurrence with Malaysia Rail Link and Export-Import Bank of China. Also, a two-year bargain in security to supply and construct four ships was additionally signed. China will likewise subsidize the agreed East Coast Rail Line (ECRL) in Malaysia by giving US$ 13 million (RM 55 billion) in soft loans for the venture. It will also give engineering and design to the ECRL, secure all materials and gear and convey the facility to Malaysia.

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