Goods and Services Tax or GST is a broad-based consumption tax levied on the import of goods (collected by Singapore Customs), as well as nearly all supplies of goods and services in Singapore. In other countries, GST is known as the Value-Added Tax or VAT.
GST exemptions apply to the provision of most financial services, the sale and lease of residential properties, and the importation and local supply of investment precious metals. Goods that are exported and international services are zero-rated.
The table below lists the categories and types of taxable and non-taxable supplies.
Standard-Rated Supplies
(7% GST)
Zero-Rated Supplies
(0% GST)
Exempt Supplies
(GST is not applicable)
Out-of-Scope Supplies
Most local sales fall under this category.
E.g. sale of TV set in a Singapore retail shop
Export of goods
Sale and rental of unfurnished residential property Importation and local supply of investment precious metals
Sale where goods are delivered from overseas to another place overseas
Private transactions
See Out-of-scope supplies for more information.
E.g. provision of spa services to a customer in Singapore
Services that are classified as international services
Financial services
E.g. issue of a debt security
As a business, you must register for GST when your taxable turnover exceeds $1million.
If your business does not exceed $1 million in taxable turnover, you may still choose to voluntarily register for GST after careful consideration.
Please refer to our webpage for more information on whether you need to register for GST.
Once you have registered for GST, you must charge GST on your supplies at the prevailing rate with the exception of relevant supplies that are subject to customer accounting. This GST that is charged and collected is known as output tax. Output tax must be paid to IRAS.
The GST that you incur on business purchases and expenses (including import of goods) is known as input tax. If your business satisfies the conditions for claiming input tax, you can claim the input tax on your business purchases and expenses.
This input tax credit mechanism ensures that only the value added is taxed at each stage of a supply chain.
A GST-registered manufacturer imports leather from overseas for the manufacture of a bag. The manufacturer sells the bag to a GST-registered retailer. Thereafter, the retailer sells the bag to a consumer. This is how GST works at each stage of the value chain:
Pays GST to Singapore Customs for the import of leather
Import value = $100
Import GST paid = 7% X $100=$7 (input tax to claim from IRAS)
Charges and collects GST for sale of bags to retailer
Selling price to retailer = $200
GST charged to retailer = 7% X $200 = $14 (output tax payable to IRAS)
2. Retailer
Pays GST to Manufacturer
Purchase value = $200
GST paid = 7% X $200=$14 (input tax to claim from IRAS)
Charges and collects GST for sale of bags to end consumer
Selling price to end consumer = $300
GST charged to end consumer = 7% X $300 = $21 (output tax payable to IRAS)
3. End-consumer
Pays GST to Retailer
Purchase value = $300
GST paid = 7% X $300=$21
End consumer is not GST-registered. Therefore, he cannot claim the GST paid on his purchase from IRAS.
As a GST-registered business:
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No, if you are not a GST-registered business, you cannot claim the GST incurred on your purchases.