Fighting 'missing trader' GST fraud in Singapore

MISSING Trader Fraud (MTF) is a problem that has plagued tax authorities around the world. It is a form of fraud by which syndicates make use of the Goods and Services Tax (GST) regime to defraud tax authorities.

There are essentially two broad aspects of the GST regime that should be noted when one seeks to understand how MTF takes place.

The first is that a GST-registered supplier has to charge GST on its supplies to the purchaser. This is known as output tax. Under the law, the output tax paid by and collected from the purchaser has to be paid by the supplier to the tax authorities.