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Second Reading Speech by Mrs Lim Hwee Hua, Minister of State for Finance and Transport on the Customs (Amendment) Bill, at The Parliament, 23 Jan 2008

23 Jan 2008

Mr Speaker, Sir, I beg to move, "That the Bill now be read a second time".

2. The Customs (Amendment) Bill comprises 3 main categories of changes. The first provides for the simplification and updating of various Customs rules and requirements to make them more business- and public-friendly. The second category covers amendments to the Customs Act to simplify penalty provisions and streamline the enforcement regime. The third enables Customs to better facilitate trade. Let me now highlight the key changes.

Simplification and Updating Customs' Rules and Requirements

(a) Exempting Any Person or Goods from Any Provision of the Customs Act

3. Currently, the Act already provides the Minister for Finance with the power to exempt (by Order) any custom duties, excise duties, taxes, fees or other charges. However, the Act does not provide for the flexibility to grant exemption from Customs' rules and requirements. Clause 3 will provide the Minister this flexibility to grant exemptions from certain Customs rules, including licensing requirements, when warranted.

(b) Waiving the Permit Requirement to Import Dutiable Goods

4. The second change relates to the authority to waive the requirement on import permit for dutiable goods into Singapore. The proposed amendment allows the Director-General of Customs the flexibility to waive permit requirement on a case-by-case basis. For example, currently, air travellers require a permit to bring in more than 10 litres of liquor, even if the limit is exceeded just slightly. With this amendment, the Director-General may waive the import permit for a bona fide air traveller. Clause 6 of the Bill provides for this change.

(c) Empowering the Director-General of Customs to Grant a Licence for the Manufacture of Dutiable Goods

5. The next change likewise relates to the authority to grant a manufacturing licence to manufacture dutiable goods. Providing Director-General instead of the Minister the power to directly approve such licences simplifies the administration of licence application and is consistent with the issuance of other Customs licences. Clause 8 of the Bill provides for this change.

(d) Issuing a Composite Licence

6. A major change relates to the streamlining of the number of licences for eligible companies. Currently, a company applies for a separate licence for each physical premise to carry out a specified activity, such as manufacturing, warehousing or sale of dutiable goods. For example, a company which carries out 2 activities at 2 premises may need to apply for 4 licences. The proposed amendment allows Singapore Customs the flexibility to grant companies with good risk management control a composite licence for its various activities at different premises. This reduces the regulatory compliance costs for companies. Clauses 10 and 15 of the Bill provides for the introduction of composite licence.

Simplification of Penalty Provisions and Streamlining the Enforcement Regime

7. I shall now move on to the amendments that simplify and streamline the current penalty provisions and the enforcement regime under the Customs Act.

(a) Allowing Analyst Certificates from Other Laboratories to be tendered as Prima Facie Evidence

8. The first change relates to the evidence presented in court. Currently, only an analyst certificate from Health Sciences Authority may be used as prima facie evidence in court. The proposed amendment allows analyst certificates from other laboratories specified by the Director-General of Customs to be tendered as prima facie evidence in court. This change is covered by clause 11 of the Bill.

(b) Re-classifying Customs Offences

9. The next change relates to the re-classification of customs offences by mode of commission of the offences. This serves to streamline the various offences for better comprehension. There are no changes to the penalties levied on the offences. There are also no substantive changes in the scope of customs offences other than the consequential change to cater for the introduction of composite licence. Clauses 12 and 13 of the Bill provide for this change.

Facilitation of Trade

10. Sir, the last category of change seeks to improve the existing Customs process to facilitate trade. The proposed amendments will enable the issuance of Customs Rulings, which are determinations on tariff classification, country of origin and duty treatment. This will give traders greater certainty on the customs rules and duties applicable to the goods. Clauses 5 and 14 of the Bill provide for this change.

Miscellaneous Amendment on Special Diesel Tax

11. Finally Sir, in addition, there is one miscellaneous amendment. The amendment relates to the increase in special diesel tax on taxis from $4,700 to $5,100 that had been collected since July 2004, and the special diesel tax collected from one private hire car since October 2002. The tax increase had been announced and implemented, and the proposed amendment will regularise the tax collection. This is covered by clause 4 of the Bill.

Consequential Changes to the Goods and Services Tax (GST) Act

12. The bill will also cover one consequential amendment to the GST Act. Clause 16 of the Bill makes an amendment to the GST Act to take account of the abolished licensed factory warehouse scheme in this Bill.


13. To conclude, the Customs Act will be updated to be more business friendly, to streamline the enforcement regime, and to better facilitate trade. Mr Speaker, Sir, I beg to move.