One of the masterminds behind what authorities in Singapore call “the largest and longest-running” syndicate selling duty unpaid alcoholic beverage has been handed a S$28 million (US$20.1 million) fine.
The criminal mastermind together with 11 other accomplices staged the Lion City’s biggest alcohol tax evasion case, which is believed to have evaded S$25 million taxes between 2017 and 2019.
The criminal took advantage of a loophole in Singapore that allowed duty-free alcoholic beverages to be sold for onboard consumption inside vessels for crew members, and diverted the duty-free alcohol to local market for higher profits, according to local news Zao Bao.
According to judge’s ruling, Lim Wei Luen was found guilty of fraudulent evasion of excise duty and goods and services tax (GST ) totaling more than S$3.1 million, and was handed a fine of more than S$28 million, more than nine times of the evaded taxes.
His partner in crime, Teo Tian Soon, was earlier sentenced to a year’s jail and a fine of nearly S$48 million (US$34.5 million).
In Singapore, duty-free alcohol is allowed to be supplied to vessels for crew members to consume. The suppliers of such alcoholic beverages are known as ship chandlers. They can buy the alcohol from suppliers whose stocks are held at licensed warehouses with legal permits.
Met in 2017, the duo quickly hatched the scheme. They created shell companies, forged permits and licenses to funnel duty-free alcohol meant for crew members to local markets.
Their criminal operation was only uncovered in November 2019 after the Singapore Customs tailed one of the trucks used by the syndicate that led to its warehouse for the all the illegal wines and spirits.
Unlike Hong Kong where wine is tax free, Singapore imposes relatively high taxes on alcohol. In the country, tax on wine and spirits is calculated on the basis of S$88 per liter, while for beer the tax is S$60 per liter. Additionally, all imported alcoholic beverages are subject to 7% GST.
The country also has a curfew on alcohol sale. Due to the Liquor Control Act that was introduced in 2015, the sale and consumption of alcohol was banned in public places after 10:30pm.