Excise Factory Scheme
Excise Factory Scheme
What is it?
An excise factory is a designated area licensed by Singapore Customs for manufacturing and storing dutiable goods, namely liquor, tobacco, motor vehicles, compressed natural gas, petroleum and biodiesel blends. This designated area is also known as licensed premises. Excise duty and Goods and Services Tax (GST) will be suspended if the manufactured goods are stored in the licensed premises.
Under the Excise Factory Scheme (EFS), activities such as bottling, blending, compounding, varying intoxicating liquors as well as refining and treating of petroleum or biodiesel blends are allowed.
Your company will enjoy these benefits under the Excise Factory Scheme:
- Excise duty and GST will be suspended for manufactured goods stored in the licensed premises
- Improved cash flow
How to Qualify?
To qualify for the Excise Factory Scheme, the company must:
- Be GST-registered with the Inland Revenue Authority of Singapore
- Have a valid Customs Account
- Have good compliance records with Singapore Customs
- Be responsible for the security, accountability and control of the dutiable goods
- Undergo TradeFIRST assessment and meet all the mandatory criteria while attaining the minimum band to qualify for the different activities under the scheme (Refer to “Licence Fee” section).
The annual licence fee varies with the type of activity, and is payable upon issuance of the licence.
|Activity||Annual Licence Fee||minimum TradeFIRST Band to qualify|
|To ferment or manufacture ale, beer, stout or porter, where the projected annual production volume (in the case of an application for the issue of a licence) or the past annual production volume (in the case of an application for renewal of a licence) is —|
|(i) 1.8 million litres or more||$31,600||Enhanced|
|(ii) less than 1.8 million litres||$8,400||Standard|
|To distill, ferment or manufacture any other intoxicating liquors|
|(i) 400,000 litres or more||$23,500||Enhanced|
|(ii) less than 400,000 litres||$10,200||Standard|
|To manufacture cigarettes||$120,000||Enhanced|
|To manufacture tobacco other than cigarettes||$1,800||Enhanced|
|To bottle, blend, compound or vary intoxicating liquors in accordance with Section 66 of the Customs Act||$7,600||Standard|
|To refine and treat petroleum or biodiesel blends||$75,000||Enhanced|
|To manufacture compressed natural gas for supply to motor vehicles||$2,600||Standard|
|To manufacture any other dutiable goods where the goods manufactured are subject to payment of excise duty||$30,000||Enhanced|
Accountability to Singapore Customs
- Accountable for dutiable goods stored in the licensed premises and for the payment of excise duty on goods not accounted for
- Declare relevant Customs permits through TradeNet for movement of all goods in and out of the licensed premises, and abide by the stipulated permit conditions
- Report to Singapore Customs if there is any discrepancy in the licensed premises by the next working day
- Provide assistance to Singapore Customs, including but not limited to manpower and system access for the purpose of any investigation, periodic audit, stock check and supervision operation conducted by Singapore Customs
- Comply with the Customs Act, Customs Regulations, and the licensing Terms & Conditions
- Accountability to Other Competent Authorities
- Obtain the necessary approvals from the relevant Competent Authorities (for example, the storage of controlled goods, including Dangerous Goods)
- Inventory Control
- Ensure inventory records and supporting documents are properly maintained and updated
- Physical Security Control
- Ensure adequate security measures in the licensed premises
- Ensure all entrances and exits are secured when there is no movement of goods in the licensed premises
- Obtain prior approval from Singapore Customs for any structural alteration to the licensed premises
- De-licensing of Licences
- Ensure all equipment for manufacturing intoxicating liquor are disposed of, in a manner approved by Singapore Customs, prior to application for de-licensing.
- The licensee shall inform Singapore Customs on the method and place of disposal, and submit supporting documents such as invoice, permits, airway bill/bill of lading, certificate of destruction, etc. for verification. Singapore Customs would process the de-licensing application only after the proper disposal of the equipment.
How to Apply?
Step 1: Complete the TradeFIRST Self-Assessment Checklist as follows:
Step 2: Prepare these supporting documents:
- Accounting and Corporate Regulatory Authority BizFile Report
- Audited financial statements for the past 3 years
- One copy of the layout plan. (Please indicate the intended licensed premises, entry/exit points and security features such as closed-circuit televisions and alarm systems in the layout plan. The plans must show the address affixed with the company stamp.)
- Title deed or tenancy agreement
- Other relevant documents
Step 3: Apply online.
For new applications, the Banker’s Guarantee or Insurance Bond will be based on the projected maximum excise duty of the goods stored in the intended licensed premises.
For existing licensees, the amount will be based on the average monthly excise duty of the goods stored in the licensed premises over the last 12 months.
Once the application is successful, we will contact you to follow up on your application.
For further assistance, please email firstname.lastname@example.org.
Application for Changes to Schemes for Existing Licensees
You may complete your applications for changes to schemes for existing licensees or to update records online.
Frequently Asked Questions (FAQs)
1. Where can I find the Harmonised System (HS) codes and duty rates of dutiable goods?
Find out more about Duty Rates of Dutiable Goods and access the Harmonised System (HS) Product Code Search Engine.
2. How do I compute the excise duty payable on locally manufactured liquors?
Total excise duty = Total quantity in litres x Excise duty per litre of alcohol x % of alcoholic strength
For example, the total excise duty payable on 1,000 litres of locally manufactured stout with 5% alcoholic strength will be:
1,000 litres x $60 x 0.05 = $3,000.
3. Do I need to seek prior approval from Singapore Customs to import apparatus or power-operated machinery for the manufacture of dutiable goods?
Yes, prior approval from Singapore Customs is required before these goods are imported.
4. Is the licence subject to renewal?
Yes, the renewal of the licence is dependent on:
- Payment of the annual licence fee
- Lodgement of the Banker’s Guarantee or Insurance Bond, if applicable
- Compliance records with Singapore Customs
- Outcome of the TradeFIRST assessment
5. Is the licence transferable?
The licence is strictly non-transferable. There should be no sub-letting of the excise factory. The manufacturer is responsible for the movement of all goods in and out of the excise factory.
6. How do I declare Customs permits?
Customs permits can be declared through TradeNet.
Find out more about Permit Declaration.
7) What are the specific requirements to operate a Microbrewery in Singapore?
Please refer to the Excise Factory Scheme (Microbrewery) Handbook for more information.