Soon, You Might Have to Pay GST for Your Online Purchase. Here’s What You Should Know


When I was young, I had to follow my parents around a shopping mall just to shop for a new refrigerator. The weekend crowd was ridiculous and there was nothing to do for a 6 year old kid (besides running around and being a nuisance).

It wasn’t a pleasant experience for me, to say the least.

Even now, I can’t really say I enjoy going to a shopping mall.


Websites like Taobao and Amazon have brought about indisputable conveniences into our lives. With the click of a finger, we could get a refrigerator delivered to our doorstep.

What’s not to love about them, right? Besides, it’s also cheaper buying online most of the time (minus rental, employees etc).

So, here comes the bad news.

Indranee Rajah, Senior Minister of State for Law and Finance, said on 21 Nov that e-commerce will likely come under the local tax regime soon.


She also said that;

“You can imagine, 20 years from now, the way people purchase is very different and by that time online platforms will be mainstays, so if that’s not part of the tax regime, there’s going to be a lot of holes there”

So, they are just finding a way to tax us lah. Although I’m not too happy about it, I suppose this does make sense in the long run.

I’m actually really interested to know how they’re planning to tax every single e-commerce though.


At the moment, taxes only apply to online goods and services above $400.

KPMG Singapore’s head of tax, Mr Chiu Wu Hong, said that this amount could be reviewed for the purpose of taxing online transactions.

A reverse charge mechanism, where the customers are required to account for the tax on goods received from foreign suppliers, could also be implemented.

If you don’t understand, we are basically being made to pay tax for our online purchases lah.


As of now, most countries adopt the vendor collection model. Under such a model, overseas sellers are required to register for GST to account for GST on sales in the country.

Well, I suppose taxing the online retailers does help level the playing field between local retailers and overseas sellers. After all, shops in Singapore were hit pretty hard by e-commerce too.

At this rate, in 20 years’ time, we might not have a shopping mall for us to go shopping in anymore. Not that it really affects me much though (I shop online because I don’t want to leave the comfort of my home).


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