The public was asked to accept the potential social fall-out from casinos due to their projected economic benefits including tax revenue. Thus, it is interesting that the Bill introduces Clause 7 which allows the Minister to remit the tax on gaming revenue if he considers it just and equitable. I am aware that a similar provision exists in other tax legislation such as the Income Tax Act and Property Tax Act giving the Minister power to remit those taxes if he considers it just and equitable. However, in the context of the IRs, under what circumstances would it be just and equitable to forgive the casino tax due from the casino operator? Could the Minister clarify whether there is concern about the viability of the IRs due to the mixed projections put forth by various analysts?
Another provision which should be clarified is Clause 4, concerning the new S 146B. In particular, S146B (5) provides that if the casino operator does not submit tax returns for 2 consecutive accounting periods, then the Comptroller of Income Tax can take this into account in making his assessment. In particular, it is provided that the Comptroller can take the failure into account and make an assessment of “an amount of casino tax greater than that which he would otherwise have considered to be appropriate”. Does this mean that the amount of tax is going to be deliberately over-assessed because the casino operator failed to file returns? This does not seem to be an appropriate response. By contrast, other tax legislation such as the Income Tax Act make it an offence not to file returns, which attracts certain punishments like penalties and fines, which on principle seem more justifiable.
Clause 8 introduces the offence of making an incorrect return or giving incorrect information. This becomes an offence under the new S149A, and is punishable with the following: a penalty of double the tax under-paid due to the error, and either fine or imprisonment or both. This section is worded very generally and does not distinguish between errors which are deliberately or recklessly made and errors made after due diligence was exercised. By contrast, the corresponding provision under the Income Tax Act – S 95 – clearly distinguishes between the 2 types of errors, where those made after due diligence are punishable only by a penalty equivalent to the tax which was underpaid. Under the proposed S 149A, errors made after due diligence will also potentially attract double tax and fine / imprisonment. Why does the provision not distinguish between the 2 types of errors?
Finally, regarding exclusion orders – I am glad to note the new S165A providing for blanket exclusion of undischarged bankrupts from entering the casino, rather than a cumbersome case by case approach. This blanket exclusion for undischarged bankrupts in effect adopts a suggestion made by the Member for Hougang Mr Low Thia Khiang in 2006 when the Bill was first debated.
(Note: this speech was delivered in Parliament on 15 Sep 2009.)
