Gambling Duties Bill
Mr Louis Ng Kok Kwang (Nee Soon): Sir, this Bill will consolidate the laws on duties for lawful forms of gambling. I have three points of clarifications to raise.
My first point is on the remission of gambling duty. The new section 12(1) provides for the remission of gambling duty when the gambling duty is not compatible with the purposes of the Act. Can the Minister clarify under what circumstances will gambling duty be considered not compatible with the purposes of the Act? Further, the Minister may delegate the exercise of his or her powers in relation to remission to a Commissioner or public officer. Can the Minister clarify if there are limits to the categories of public officers to whom the Minister's powers can be delegated to?
My second point is on the amount of penalty tax that can be imposed on outstanding gambling duties. The new section 14(2) limits the amount of penalty tax that can be imposed to 50% of the amount of gambling duty outstanding. I agree that the amount of penalty tax should not be excessive for an individual. That said, can the Minister share what enforcement tools are available to the Ministry for the recovery of gambling duties if these remained unpaid even after the maximum amount of penalty tax has been reached? Can the Minister also share what softer measures are available for the Ministry to work with an indebted individual to meet his or her debts?
My final point is the effect of the present Bill on Singapore's public policy on gambling. The position of Singapore's public policy on gambling has been scrutinised in a series of Court of Appeal cases, including Liao Eng Kiat versus Burswood Nominees Ltd and Poh Soon Kiat versus Desert Palace Incorporated.
While the cases concerned the enforcement of gambling debts which were incurred abroad, a relevant issue considered in these cases is the local policy position on gambling. In those cases, the Court had also considered local legislation on gambling, including the Gaming Act, Casino Control Act and Common Gaming Houses Act.
Can the Minister clarify if the consolidation of laws on levies and collection of duties on lawful betting and lotteries have any effect on the public policy position on gambling in Singapore? If so, how should the Government's position on gambling be understood?
In summary, I hope the Minister can shed light on my clarifications relating to the remission of gambling duty, the imposition of penalty taxes and Singapore's public policy on gambling. Sir, notwithstanding my clarifications, I stand in support of the Bill.
Mr Lawrence Wong (The Minister for Finance): Mr Deputy Speaker, I thank Members Mr Gan Thiam Poh, Mr Yip Hon Weng, Mr Louis Chua and Mr Louis Ng for their support for the Bill. Let me address their comments and queries in turn.
Mr Yip asked whether the Bill will create significant additional resourcing needs by IRAS. It will not. First, the Bill consolidates and streamlines laws that are currently contained within the BSDA and PLA. So, many of these functions are already performed by IRAS today. Second, where there are new functions like electronic serving of notices, or the ability to enter and search premises for the enforcement of betting and sweepstake duties, these functions are not new to IRAS. IRAS currently performs these functions for the other taxes that it administers and has the requisite capabilities.
Mr Yip also asked if IRAS has plans to use smart technology to support its operation. IRAS already does this and will continue to do so. The consequential amendment to the IRAS Act in this Bill to provide for an electronic service system paves the way for e-services for betting and casino operators, and private lottery promoters. More generally, IRAS is developing new artificial intelligence applications to enhance and automate key processes for the taxes that it administers. IRAS will continue to improve on its administration and enforcement to keep it efficient and effective. In fact, fiscal year 2020, across all taxes, IRAS has kept its cost of collection low, at less than one cent for every dollar of tax revenue collected.
Mr Ng asked what enforcement tools are available to IRAS for the recovery of unpaid gambling duties and where the maximum penalties have already been reached. He also asked what softer measures are available for an indebted individual to meet his tax obligations. The taxpayers for the three types of betting taxes – casino tax, private lotteries duty and betting and sweepstake duties – are business providers of gaming and generally not individuals acting in their individual capacity. So far, these taxpayers have been compliant. If the need arises to recover unpaid betting taxes, the tools available for IRAS include suing the taxpayer, or appointing someone who holds money for the taxpayer, such as a bank, to pay the sum to the Commissioner. If an individual is indebted, IRAS will explore a payment arrangement with the indebted individual to meet his or her debts.
As to Mr Yip's suggestion to require an appellant to pay costs to prevent frivolous applications for assessment, reassessment of liability, and appeals, such frivolous applications are not an issue currently for betting taxes. So, we do not charge taxpayers who apply to IRAS for revising their tax assessments.
Mr Yip asked how we protect taxpayer data. Clause 43 of the Bill ensures that all taxpayer data collected by IRAS for the gambling duties will be regarded as secret and confidential. A corresponding provision already exists in most other tax Acts. It is an offence to share confidential information except in certain specified circumstances. Authorised persons who are granted access to taxpayer data are required to make and subscribe to a declaration of secrecy. Even without a specific confidentiality provision, taxpayer income information is protected by the common law duty of confidentiality, the Official Secrets Act and the data protection regime under the Public Sector (Governance) Act.
Mr Ng asked about the remission of gambling duties. This pertains to clause 12(1) of the Bill which provides for remission when the gambling duty is not compatible with the purposes of the Act.
This Ministerial power to remit taxes is a provision that is present in other existing tax Acts like the GST Act, the Income Tax Act, the Property Tax Act and the Stamp Duties Act. So, it is a generic provision that we have in our tax Acts. While it is unlikely that such remission power will be invoked for gambling duties, we have, nevertheless, provided for this remission power for gambling duties in the remote event that such an unforeseen situation should arise.
Now, let me touch on the broader impact of the Bill.
Mr Yip asked whether small-scale vendors and franchisees, especially those who sell Big Sweep and lottery tickets in the heartlands, will be affected. The changes only affect the betting operator, or the private lottery promoter, rather than retailers. For the individual retailers, the amendments do not require any additional action on their part and because there is no change in the rates of duty, the amendments will also not impact their earnings.
Mr Louis Chua asked if the Government would consider a raising of betting taxes, particularly with regard to sweepstakes and private lotteries. These are not being contemplated as part of this Bill. There is no change that we are proposing for now, but we will continue to review the betting tax regime as we do for other taxes on a regular basis. Our objective is to ensure that betting taxes are high enough to manage gambling demand, and at the time, we want to ensure that operators and promoters can compete effectively against illegal gambling operators.
I turn now to Mr Yip and Mr Gan's questions on the revenue collection associated with the changes in this Bill.
On the casino tax, Mr Gan asked about the gaming revenue from local and foreign visitors, for premium and mass gaming. We do not collect data on the proportion of casino tax from local and foreign visitors. This is because casino tax does not differentiate between whether the individual concerned is a local or a foreigner.
I am unable, unfortunately, to share the details of casino tax collections. As there are only two casinos in Singapore, the Government is unable to disclose the amount of casino tax revenue, or breakdown between premium and mass gaming. Casino tax revenue is included under a broader classification of betting taxes which also includes taxes from lotteries, horse and sports betting and fruit machines. The total revenue from all betting taxes was $2.6 billion in FY2019; and $1.8 billion in FY2020. The numbers are still being finalised for FY2021 but we do not expect them to recover to pre-COVID-19 levels in the short term.
As for Mr Gan's question on the projected increase in revenue with the expansion and increase in economic contribution, I believe this has been covered by Minister of State Alvin Tan when he talked about the expected economic benefits of IRs in his speech. The increase in tax revenue would depend on how well the IRs do after their additional investment.
Finally, in response to Mr Ng's query, this Bill consolidates the existing laws on the levy and collection of taxes on lawful betting and lotteries but it does not impact what Singapore's public policy position on gambling is. We have, on multiple occasions, articulated our approach towards problem gambling and this position remains unchanged.
Mr Louis Chua also asked about resources to address this and I would like to assure him that the Government will ensure that sufficient resources are set aside to deal with problem gambling.
Mr Deputy Speaker, I believe I have addressed Members' concerns and questions and I beg to move.
Source: Hansard
