Employees of Jeweller Convicted for Conspiring in GST Tourist Refund Fraud

5 Jul 2019

Six employees of a local jeweller Abiraame Jewellers – Arumugam Chelladurai (aged 48), Kulamani Ganesan (aged 31), Manickavasagam Saravanan (aged 40), Pang Wei Koon (aged 46), Murugesan Saravanan (aged 41) and Shanmugam Sampathkumar (aged 33) – have been convicted in Court for assisting claimants in making fraudulent Goods and Services Tax (GST) tourist refund claims.

The six employees faced a total of 80 charges for their involvement in the conspiracy, in which GST tourist refunds amounting to approximately $15,282 were fraudulently claimed. Please refer to Annex A (255KB) for a summary of their court sentences.

Facts of the Case

The case is linked to the five Indian nationals (“claimants”) who were previously arrested and convicted for conspiring to make fraudulent GST refund claims at Changi Airport. As part of their illegal scheme, the claimants would loiter in and around a number of jewellery shops along Serangoon Road, including Abiraame Jewellers’ two shops at 85 and 123 Serangoon Road, for the purpose of obtaining invoices and jewellery tags from customers of those shops who had made jewellery purchases. The claimants would either approach customers, or be approached by customers or employees of Abiraame Jewellers on behalf of the customers. The claimants would obtain invoices by paying customers for their invoices or by agreeing to help customers bring their jewellery back to India on their behalf.

Once a customer agrees to sell or give the invoice, the claimant would give his passport and embarkation card (white card) to an employee of Abiraame Jewellers to apply for a GST refund under the claimant’s passport number. The employees would enter the details of the claimant and the jewellery purchased into the electronic Tourist Refund Scheme (eTRS) system, and print an eTRS refund ticket for the claimant. The employees did this despite knowing that the claimants were not eligible for the refunds as they were not the actual purchasers of the jewellery listed on the eTRS refund tickets.

Abuse of the GST Tourist Refund Scheme (TRS)

The TRS is available only to bona fide tourists for the claiming of GST refunds on goods they have purchased and brought out of Singapore. Permanent Residents, as well as foreigners who have been employed in Singapore in the past six months before the date of purchase, are not eligible for GST refunds under the TRS. For the full list of TRS qualifying criteria and conditions, please refer to the IRAS website.

It is an offence for a person to obtain GST refunds if the person does not meet the TRS qualifying criteria and conditions. It is also an offence for an individual to assist another person in obtaining fraudulent eTRS refunds, such as by selling one’s receipt or invoice to support the claim.

IRAS will not hesitate to take stern enforcement actions against any individual who with willful intent make a false GST refund claim or assist any other person to make false claims. IRAS will also not hesitate to take firm action against retailers who are complicit or negligent in the issuing of eTRS tickets leading to the abuse of the Tourist Refund Scheme.

Reporting of Malpractices

Businesses or individuals are encouraged to immediately disclose any past tax mistakes. IRAS will treat such disclosures as mitigating factors when considering action to be taken. Those who wish to disclose past mistakes or report malpractices can write to:

Inland Revenue Authority of Singapore
Investigation & Forensics Division
55 Newton Road, Revenue House
Singapore 307987

Email: ifd@iras.gov.sg

Cash Rewards for Informants

A reward based on 15% of the tax recovered, capped at $100,000, would be given to informants if the information and/or documents provided lead to a recovery of tax that would have otherwise been lost. All payments are at the discretion of the Comptroller. IRAS will ensure that the identities of informants are kept strictly confidential.