30 October 2019
On 7 October 2019, the Goods and Services Tax (Amendment) Bill (“Bill”) was introduced in Parliament. Among other things, the Bill seeks to make changes relating to the planned introduction of goods and services tax (“GST”) on imported services from 1 January 2020, which was announced in the 2018 Budget Statement.
This Bill seeks to amend the Goods and Services Tax Act for purposes including the following:
- Refine design parameters for GST on imported services: GST will apply to imported digital services in the context of business-to-consumer transactions. For business-to-business supplies of imported services, GST will be applied by way of a reverse charge mechanism.
- Introduce offence for misrepresentation of information: It will be an offence for a customer to provide false information in relation to purchases of imported services where such information may be used by overseas suppliers to determine whether GST is chargeable.
- Update GST treatment of digital payment tokens: The GST treatment of digital payment tokens will be based on the nature of the underlying transactions. A reference to a digital payment token is a reference to a digital representation of value that has all of the following characteristics: (a) it is expressed as a unit, (b) it is designed to be fungible, (c) it is not denominated in any currency, and it is not pegged by its issuer to any currency, (d) it can be transferred, stored or traded electronically, (e) it is, or is intended to be, a medium of exchange accepted by the public, or a section of the public, without any substantial restrictions on its use as consideration.
- Remove requirement for tax appeals in Supreme Court to be heard in camera: To align with the principle of open justice and in keeping with international trends, the requirement for appeals before the Supreme Court to be head in camera will be removed.
- Introduce definitions of “accountant” and “advocate and solicitor”: Only a “public accountant” within the meaning of the Accountants Act, or an “advocate and solicitor” within the meaning of the Legal Profession Act will be allowed to represent a taxpayer before the Goods and Services Tax Board of Review.
By way of background, from 5 to 26 July 2019, the Ministry of Finance (“MOF”) conducted a public consultation on a draft version of the Bill. On 30 September 2019, MOF released a summary of responses to the feedback received from the public consultation.
- Goods and Services Tax (Amendment) Bill
- Summary of Responses to Public Consultation on the Draft Goods and Services Tax (Amendment) Bill 2019
- Annex A - Responses to the key feedback