With the hike in Goods and Services Tax (GST) by two percentage points, tax analysts said tax penalties arising from businesses making mistakes in GST audits may also increase.

GST was introduced in 1994 and the year after, the government collected S$3.3 million in tax and penalties from GST audits. Last year, the figure was S$76.2 million, an increase of over 2,200 percent.

Tax analysts said one reason for this huge increase is because the Inland Revenue Authority of Singapore (IRAS) can no longer be lenient with businesses that make mistakes.

With GST going up to 7%, analysts said businesses should pay more attention to GST accounting or they may end up paying more. - TODAY