Why should I pay the Airport Development Levy?

When Changi Terminal 5 was unveiled at the National Day Rally in 2013, we were all stoked. More so when the beautiful visuals of Project Jewel were released.

Uh oh. We forgot that this comes at a price. Who would fund these expansions? Surely not…not us?!

The Ministry of Transport (MOT) and the Civil Aviation Authority of Singapore (CAAS) announced on 28 February 2018 a new Airport Development Levy to fund the Changi Airport expansion project, or Changi East. In this post, we bring you the 5 frequently asked questions on this levy.

1.     How much is the levy?

If you are flying out of Changi Airport, you will have to pay up to S$10.80 more due to the new levy, as well as changes in passenger fees.

Fees

Source: Channel NewsAsia

2.¬†¬†¬†¬† There’s no guarantee I’ll use the facilities. Why must I pay for¬†it?

The fact is that such expansions entail a huge upfront investment.¬†Our government currently employs a three-way model –¬†made¬†up of the¬†government, Changi Airport Group (CAG), as well¬†airport users, like you and I.¬†The good thing about this model is that it prevents a large spike in charges to future airport users. Apparently, this isn’t a new concept. Airports in Hong Kong, Dubai and Qatar adopt similar models.

3.     Fine. But who paid for the previous terminals?

Surprise, surprise! We have been paying for airport upgrades and expansions. The expansion of Terminal 1 and the construction of Terminal 4 for instance, were fully funded by fees collected, such as the Passenger Service and Security Fee that were paid by airport users.

4.     Why can’t the Government pay for this project, since it has so much money?

In general, airport users should bear their share for the use of airport facilities. In fact, airport users are paying the smallest share. The Government will pay the majority of the costs, while CAG will contribute the next largest share. Airport users’ contributions is the smallest share of the joint contribution model.

5. Exactly, so costs should be borne by the Government and CAG!

Actually, if you think about it, it isn’t a good idea. If airport users are not to be charged, then the government would have to pay more.¬†Don’t forget that the¬†government’s money¬†is our money – taxpayers’ money!

Now you know – the levy isn’t too bad after all. With everyone’s contributions, we’ll be able to enjoy a brand new Changi!

Voil√†! Good news from #Cannes, France, where the prestigious @mapicworld Awards 2016 was held last night ‚Äď Jewel Changi Airport, jointly developed by @changiairport Group and #CapitaLand, has been crowned Best Futura Shopping Centre!ūüĎŹ Designed by world renowned architect #MosheSafdie, Jewel combines beautiful gardens with a vibrant marketplace housed within a distinctive glass-and-steel dome. ūüéČStrategically located in Singapore‚Äôs Changi Airport, the world‚Äôs sixth busiest #airport for international traffic, it will provide an excellent platform for leading global retail and lifestyle brands to showcase their best offerings to the world. We can‚Äôt wait to welcome you to #Jewel when it opens in early 2019. Meanwhile, here‚Äôs a sneak peek into the future! ūüėĄ

A post shared by CapitaLand (@capitaland) on

 

 

 

How can I get my tax returns automatically filled?

Ever wondered how can we get our tax returns automatically filled? For the majority of us, we enjoy a simplified tax filing process and we have our employers and IRAS to thank.

1.8 million¬†of us¬†in Singapore are fortunate to be working in companies¬†that have participated in¬†IRAS’ Auto-Inclusion Scheme (AIS).

This means that most of our companies provide IRAS with details on our salaries, and these details are hence automatically pre-filled in our tax returns. That’s why so many of us don’t even need to file our taxes (i.e. on the no-filing scheme)!

Believe it or not Рmany Singaporeans still take pains to key in their salary details in their tax forms. If you are one of them, urge your employer to get on the AIS scheme right away! (Get your company to apply for it here)

If you can’t get them to budget, fret not. As part of the government’s initiative to¬†take things online,¬†the AIS scheme¬†has been made compulsory for some companies.

For instance, from Year of Assessment 2015, it is compulsory for employers with 10 or more employees to come onboard the scheme. From Year of Assessment 2018, participation in AIS will be compulsory for employers with 9 or more employees. We see what you did there!

If your company still isn’t taking steps, push for the Auto-Inclusion scheme right away! Rally to get your company on board to enjoy seamless tax filing and save time and effort from keying in your tax returns every year!

For more information, please visit IRAS’ website at this link.

 

Court affirms Singapore’s duty in sharing tax data

The Court of Appeal has today affirmed Singapore’s powers and duty in responding to data-sharing requests from its foreign counterparts. This power was sealed since the judgment was passed on this case:¬†AXY and others v Comptroller of Income Tax (2018)

If you’re a foreigner and you’re trying to hide your money in Singapore, don’t even try. It is unlikely that you can get away with evading taxes since your country will ask for bank data from Singapore!

This puts Singapore’s tax authority, IRAS, in good stead to align itself with the internationally agreed Standard for EOI treaty moving forward.

Here’s what happened:

The tax authority of Korea, the National Tax Service (NTS), was investigating five Korean individuals, as well as companies owned by some of them. The NTS suspected that these individuals had bank accounts in Singapore that were being used to conceal their income in order to evade taxes.

Korea then reached out to Singapore for help in getting the bank data and documents of these five individuals to help with its investigations. This request is called an EOI or Exchange of Information request.

After much consideration, Singapore’s tax authority (IRAS) issued production notices against three Singapore banks to get them to share the data. This was when a few of the five Korean individuals applied to Singapore’s High Court to stop IRAS’ order.

The High Court rejected the five Korean individuals’ application in September 2017, and today, the Court of Appeal affirmed the High Court‚Äôs decision.

The decisions of both the High Court and the Court of Appeal have put beyond doubt the Comptroller’s powers and duties at law in responding to an EOI request from a foreign treaty partner.

What a historic moment for Singapore!

Did you know? 

Singapore took up the EOI Standard in 2009. This shows that we are committed in combating cross-border tax offences. Since 2013, global forums have affirmed that Singapore’s EOI regime is in line with the EOI Standard, both in terms of legal framework and implementation.

The decisions of both the High Court and the Court of Appeal in this case have made clear the legal position on EOI administration and also endorses Singapore’s decision to assist in the request from the South Korean tax authority based on its assessment that the request was consistent with the EOI Standard.

Click here for Supreme Court’s case summary

Click here for IRAS’ press statement

 

 

Why isn’t Airbnb allowed in Singapore?

Short-term rentals in Singapore aren’t legal. But if it’s a long-enough stay, it is actually alright.

For instance, if you own a private apartment, the minimum rental period is 3 consecutive months (lowered from 6 months since June 2017). If you own a HDB flat, the minimum rental period for each tenant is 6 months.

Recently, two Singaporean Airbnb hosts were fined a total of $60,000 each¬†for the unauthorised short-term letting of four condo units. This¬†is the¬†first of¬†such cases under Singapore’s short-term property letting rules, and is seen as a deterrent move.

Simply put, if you were to let out¬†a property for the short term illegally, through Airbnb for instance, you are risking yourself to heavy penalties.¬†Align your rental periods¬†with the regulations, please! It doesn’t seem worth it to make quick cash this way.

Why can’t we rent out for the short-term?

Though¬†you’re generating a profit, we know of many Singaporeans who are against short-term rentals.¬†Just think about it –¬†these short-term¬†stays¬†will disrupt the living environment of others around you.¬†Noise by happy holidaymakers, for instance. These¬†tenants may also¬†pose security concerns for neighbours and their children. These, we think, are some concerns¬†Singaporeans¬†have.

To appease the concerns of the Singapore government, Airbnb shared that¬†it is willing to not list public housing on its site.¬†In fact, measures can be put in place to ensure that all hosts comply. For instance, Chicago has a “three strikes” policy, which bars hosts who repeatedly break the rules, while in New Orleans, no accommodation¬†in the oldest section of its city (i.e. the French Quarter)¬†can be listed on its site.

Let’s see how this dialogue works out, shall we? Don’t just leave it to the two parties though. If you have views, you are encouraged to participate in URA’s upcoming public consultation on short-term letting.

P.S.: The irony

Despite these concerns, Airbnb has a swanky new¬†office is in Singapore! Though we aren’t a big market for Airbnb, we’ve been chosen as the headquarters for Asia Pacific. Feast your eyes away!

 

As the saying goes, if you can’t beat ’em, join ’em. What are you waiting for? Get your resumes out already!


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