Deferment of Income Tax Payment for Retrenched Citizens
Ministry of FinanceSpeakers
Summary
This question concerns Mr Zainal Sapari's inquiry to the Minister for Finance on whether retrenched citizens can defer income tax payments until they secure employment. Senior Minister of State Ms Indranee Rajah responded that taxpayers may utilize 12-month interest-free GIRO instalments, with longer plans available for hardship cases. She advised individuals to approach the Inland Revenue Authority of Singapore directly, noting that tax liabilities are generally not waived to maintain fiscal discipline. Senior Minister of State Ms Indranee Rajah emphasized that the authority exercises flexibility to balance tax recovery with compassion for those in genuine difficulty. This policy supports individuals currently unable to meet obligations while upholding necessary fiscal discipline for the state.
Transcript
8 Mr Zainal Sapari asked the Minister for Finance whether IRAS will allow Singaporeans who are retrenched due to the economic downturn this year to defer their income tax payment till they are able to find employment.
The Senior Minister of State for Finance (Ms Indranee Rajah) (for the Minister for Finance): Mdm Speaker, under the existing Inland Revenue Authority of Singapore (IRAS) General Interbank Recurring Order (GIRO) scheme, taxpayers can pay their income tax by up to 12 monthly interest-free instalments. A taxpayer who faces financial hardship may apply to IRAS for longer instalment plans.
Mdm Speaker: Mr Zainal Sapari.
Mr Zainal Sapari (Pasir Ris-Punggol): I have one supplementary question. In serious cases of financial difficulty, will IRAS consider reducing or waiving the person's tax liability?
Ms Indranee Rajah: Madam, I think that if a person has a serious financial hardship, what the person should do is approach IRAS and speak to them. As a general rule, IRAS does not waive income tax liabilities. You need to have some financial prudence and discipline but, at the same time, you also need to balance that where individuals generally want to pay but for some reason, their circumstances really, really do not allow them to. So, the best approach is to speak to IRAS.
Currently, they do have interest-free instalment plans. They would try, where possible, to exercise flexibility. But at the end of the day, we have to do two things: maintain the fiscal prudence and discipline in tax recovery for the state and, where possible, balance that with compassion on the part of individuals.