The pandemic has gotten many of us shopping online more frequently than ever, as we enjoy perks like free deliveries and promo codes. But there may soon be a dampener on our shopping sprees in the form of a new Goods and Services Tax (GST) charge.
The Government had announced this earlier this year, but the Ministry of Finance (MOF) tabled the proposed changes to the Goods and Services Tax Act for a first reading yesterday (4 Oct).
They emphasised that the changes would start in 2023 and cover goods purchased online, with a value of up to S$400.
According to Channel News Asia (CNA), the changes will likely take effect from January 2023 on low-value imports via air or post and business-to-consumer (B2C) non-digital services.
More specifically, goods that have up to $400 in value will soon be subject to GST charges. This is currently not the case, to expedite border clearances.
Only goods above $400 have been chargeable for GST so far.
MOF reportedly explained that this move establishes a level playing field for local businesses to remain competitive.
On top of imports, MOF is also looking at GST charges for media sales, noted CNA.
This includes the sales of advertising space for hardcopy prints and outdoor advertisements, airtime via TV and radio, as well as web advertising that includes mobile devices.
However, this GST treatment will depend on the customer’s and direct beneficiary’s locations instead of where the ad will circulate.
As the world continues transitioning to more virtual transactions, it’s inevitable that the laws will change accordingly too.
While having to fork out more money to enjoy our online shopping sprees isn’t the best news, we can still hope that the charges won’t be too substantial.
But till they take effect in 2023, let’s enjoy the GST-free shopping first for the next year or so.
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Featured images adapted from Pavel Danilyuk on Pexels.
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