As most of us know, Singapore’s Goods and Service Tax (GST) rate will increase from 7% to 8% starting from January 1, 2023. The GST rate hike will impact all GST-registered businesses that produce or sell goods or services subject to the standard rate of GST.

Singapore has various assistance schemes associated with GST to create a pro-business environment. These schemes generally aid in easing the cash flow for businesses. Some examples of these schemes are the Major Exporter Scheme (MES) and the Approved Contract Manufacturer and Trader Scheme (ACMT). Read on to learn how these GST relief programs might benefit specific GST-registered businesses preparing for the GST hike.

Major Exporter Scheme (MES)

Standard rules require businesses to pay GST in advance on imports and receive a refund from the IRAS when they file GST returns. Businesses can import non-taxable goods or products without paying GST through MES.

Qualifying conditions for MES

The following conditions must be satisfied for businesses to qualify for this scheme:

  • The business must be GST-registered.
  • The business must be active and financially solvent.
  • Goods exported must be more than 50% of its total revenue and the exports are for the sole purpose of the business.
  • Good compliance records with IRAS must be maintained.
  • Proper accounting records and good internal controls must be maintained.
  • Good compliance records with Singapore Customs must be maintained.
  • You must be able to fulfil other conditions as the Comptroller of GST may enforce from time to time.

Approved Contract Manufacturer and Trader (ACMT) Scheme

As part of the standard GST obligations, GST-registered manufacturers must charge GST on their supplies of value-added activities performed on their clients’ goods in Singapore. The GST costs incurred cannot be recovered if the clients are overseas persons/entities that are not GST-registered.

Through the ACMT scheme, traders and contract manufacturers are relieved of the responsibility to charge GST on value-added services provided to overseas customers who are not GST-registered.

Qualifying conditions for ACMT

The following conditions must be satisfied for businesses to qualify for this scheme:

  • The business must be a GST-registered business.
  • The company must be a qualifying contract manufacturing company.
  • Provide value-added activities to your overseas client who is not related to you.
  • The business transactions or contracts with your overseas clients involving value-added activities must be of a substantial amount or constitute a large percentage of your turnover.
  • Processed goods must be substantially exported.
  • Good inventory controls and accounting records must be maintained.
  • Good compliance records must be maintained.
  • Complete a self-review under Assisted Self-Help Kit (ASK) or commit to participating in the Assisted Compliance Assurance Programme (ACAP).
  • Fulfil other conditions as the Comptroller of GST may impose.


The government has provided various relief programs which businesses can apply for. Once the GST rate hike is implemented, businesses need to review their contracts with customers and suppliers to determine who should bear the costs. Additionally, businesses should review any changes needed to be made to their systems or processes in preparation for the GST rate hike.

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*The above represents our opinions and views and does not necessarily reflect the position of any entities mentioned.