Drink costs $5 but Nana's Green Tea charges $5.50 after GST due to 'rounding', Iras says it's 'not right'
The difference was only five cents.
The Inland Revenue Authority of Singapore (Iras) has taken issue with how Nana's Green Tea had been charging its customers the goods and services tax (GST).
This comes after a customer, Stomper P, was charged more than she should have at the F&B outlet in Duo Galleria near Beach Road in June 17.
The Stomper was at the time with her daughter who wanted a drink.
The mum recounted: "We went into Nana's Green Tea and she spotted apple juice on the menu. It was $5. We opted for takeaway as I didn't want anything else.
"When the bill was presented, I thought I remembered the price of the juice wrongly. So I double checked. It was still $5.
"I asked the staff why bill is $5.50? The female staff member very confidently replied 'GST'.
"I said 9 per cent of $5 is $0.45. Why was the bill $5.50?
"She replied, 'Rounding'!"
The Stomper wondered whether this was legal.
"Is this rounding up trending?" she asked.
"I paid digitally. No change was required. So far I have only encountered rounding down when paying with cash."
In response to a Stomp query, a spokesperson for Iras addressed the GST charging and invoicing practice.
She explained that GST-registered businesses may round their bills to the nearest five cents to facilitate cash payment, as one-cent coins are no longer in circulation. Where the final bill including GST already ends in five cents, no rounding is required.
"In this instance, it is not right for the business to quote that the rounding from $5.45 to $5.50 is due to GST," said the spokesperson.
"Iras has since engaged the business on this matter and advised on the correct treatment."
She added that Iras takes a serious view of non-compliance.
"We will investigate and take necessary action against businesses that overcharge and wrongly collect GST on their transactions. Businesses that commit such wrongdoings without reasonable excuse or through negligence may face fines and penalties." said the spokesperson.
Members of the public can report wrongful GST practices of businesses to Iras at go.gov.sg/irasgst-wrongpractices.
