|
|
| |
|
|
| |
Moving
up the ZGS ladder
The launch of the Zero GST Warehouse
Scheme (ZGS) last year marked a major milestone in Singapore
Customs' trade facilitation drive. To date, about 100 companies
have taken advantage of the scheme. They get to enjoy GST suspension
on their imports and more leeway in inventory management.
 |
| Singapore Customs upgraded
Sankyu to a Type III licence as the company has
a robust inventory system and effective internal
goods-handling procedures. |
|
ZGS is a welcome replacement of the Bonded Warehouse Scheme
introduced in 1994 to alleviate the impact of the Goods and
Services Tax (GST) on the trading community.
Under the former scheme, no GST was charged on goods imported
into Singapore and traded within designated bonded warehouses,
so long as at least 80% of the goods were exported.
Over the years, Singapore Customs noted that many trading companies
have leveraged on technology and become more competent in managing
and accounting for their goods. In response, Customs officers
talked to many companies to understand their requirements and
enhanced the scheme.
The result of this extensive effort was ZGS, which took effect
on 1 January 2006.
This enhanced scheme offers three licences to cater to companies
with different needs and levels of internal control. Type I
licensees get to enjoy the same benefits as those under the
Bonded Warehouse Scheme. Type II licensees are allowed to sell
all their imports locally. Type III licence holders can sell
all their imports locally, operate at multiple locations under
a single licence and make consolidated permit declaration and
GST payment to Singapore Customs on a weekly basis.
Many companies with proven capabilities in inventory management
have scaled the ZGS ladder. Logistics firm Sankyu (S) Pte Ltd
is a fine example.
About
the Zero GST Warehouse Scheme
ZGS is a tax-suspension scheme that provides three
types of licences:
| • |
Type I licensees are not charged
GST on goods imported into Singapore and
traded within designated warehouses, so
long as at least 80% of the goods are exported. |
| • |
Type II licensees can sell all their imports
locally. |
| • |
Type III licensees can sell all their
imports locally, register multiple locations
under a single licence and make consolidated
permit declaration and GST payment on a
weekly basis. |
|
|
Sankyu, which provides a full range of warehousing services,
had a web-based warehouse management system and radio frequency
barcode system for inventory management It was a licensee under
the former Bonded Warehouse Scheme. When the scheme was expanded
to become the current ZGS, Sankyu was automatically issued a
ZGS Type I licence.
An expansion in business operations prompted Sankyu to apply
to upgrade to the Type III licence. Singapore Customs re-assessed
the company and was confident that it had a robust inventory
system and strong internal goods-handling procedures. Hence
Singapore Customs upgraded Sankyu to a Type III licence.
With the Type III licence, Sankyu enjoys non-demarcation status,
which allows it to store ZGS goods alongside non-ZGS goods.
The upgraded licence has thus enabled the company to optimise
its warehouse space and enhanced its position as a project cargo
transshipment hub.
Helu-Trans (S) Pte Ltd, a major international moving company,
has also given ZGS the thumbs-up. Its Art Move Division serves
regional art galleries, collectors, auction houses, artists
and art institutions. It holds a Type III licence.
The company has comprehensive storage areas such as climate-controlled
and non-air-conditioned facilities equipped with a viewing area,
24-hour security and a controlled access system. It also has
private rooms and custom shelving systems to accommodate paintings,
sculptures, artifacts and irregular-shaped items.
 |
| Helu-Trans enjoys additional
concessions as Singapore Customs is convinced the
company has strong track and trace capabilities
and good internal processes. |
|
As an added facilitation to Helu-Trans to meet its unique business
requirements, Singapore Customs gave special permission for
artworks to be moved to and from its warehouse and external
exhibition and auction venues. Singapore Customs was convinced
that the company had excellent track and trace capabilities
for their goods and good internal procedures as well.
Grateful for the licence, Mr Dick Chia, Managing Director at
Helu-Trans, said: "ZGS has been very beneficial to our
business as it allows our clients to take advantage of this
flexibility to enjoy more cost savings and leverage on economies
of scale. In our business, we only win when our clients win.
ZGS has created this win-win environment for us."
Click here
to find out more about ZGS.
| FEATURES
OF ZGS LICENCES AT A GLANCE |
| Feature |
Type I |
Type II |
Type III |
| Export requirement |
80% |
Nil |
Nil |
| Locations per licence |
One |
One |
Multiple |
| Consolidated permit declaration and GST payment |
No |
No |
Yes |
| Stock movement reporting |
Transactional |
Monthly |
Only when requested |
| Stock keeping units (SKUs) used |
Singapore Custom’s |
Company’s own |
Company’s own |
| Physical demarcation of licensed area |
Not required if company has track and trace capability |
Not required if company has track and trace capability |
Not required |
|
|
| Copyright © 2007
Singapore Customs. All Rights Reserved. |
|
|
|
