Tax collection declines 7.3% to S$49.6b in FY2020/21

This is due to reduced business activities due to COVID-19.

Tax collection for Fiscal Year (FY) 2020/2021 declined 7.3% to S$49.6b, compared to the S$53.5b collected in FY2019/2020 due to decreased activities during the pandemic, according to data from the Inland Revenue Authority of Singapore (IRAS).

Total income taxes, which include corporate income tax, individual income tax, and withholding tax, reached S$30.5b, 0.9% lower than the S$30.8b collected in the last fiscal year. Corporate income tax was 3.7% lower at S$16.1b, whilst individual income tax increased 3% to S$12.5b

Goods and services tax also declined 7.3% from S$11.2b to S$10.3b. Property tax collection was also lower by 34.3% at S$3.1b, whilst stamp duty collection fell 7.2% to S$3.9b. Betting taxes was also 34.3% lower in FY 2020/21 at S$1.7b.

“The total tax collection of $49.6b is 7.3% lower than the previous FY, due to dampened business activities amidst the COVID-19 pandemic in Singapore,” IRAS said.

“The fall in collections for corporate income and property taxes were mainly due to the implementation of support measures for businesses, such as tax rebates. In addition, GST, Stamp Duty and Betting Taxes collections were lower on account of weaker economic conditions and circuit breaker measures put in place during the year,” it added.

The total collection represents 73.6% of the government operating revenue and 10.6% of Singapore’s gross domestic product.

Tax arrears rate remained low at 0.72%, whilst arrears for income tax, GST, and property tax fell to $323.8m in FY2020/2021, from $357m in FY2019/2020.