FTZs are meant to support Singapore’s role as a centre for entrepot trading and transhipment activies. The primary function is to facilitate the transshipment of overseas goods via Singapore, that is, goods placed temporarily in the FTZ before being loaded onto another ship or aircraft for export without requiring customs clearance.

Under our GST regime, unless special schemes are applicable, GST is payable on the importation of goods into Singapore. Import GST is payable regardless of whether the importer is GST-registered or not.

If goods are imported and stored in FTZs, import GST is suspended and no GST is payable. In addition, goods in FTZs may be supplied (bought and sold) many times before they are removed. To free businesses from the burden of having to account for GST on these multiple supplies of goods, such supplies (except for supplies of local goods in FTZs which remain taxable) are disregarded for GST purposes.

If you move your overseas goods from an FTZ out of Singapore (i.e. transshipment) without entering customs territory, it is outside the scope of GST. Thus, you are not required to report such movement of overseas goods in your GST return.

Duty and import GST are only payable when the goods:

Are consumed within the FTZ; or
Leave the FTZ and enter into customs territory for local sales or domestic consumption

You are required to take up an import permit with the Singapore Customs and pay import GST on overseas goods used or consumed within an FTZ.

When you move the overseas goods from the FTZ into customs territory, import GST is payable and you are required to take up an import permit and pay importt GST. Import GST is not payable if you are removing the goods under the following circumstance: you are moving the goods directly from an FTZ into another FTZ, a Warehouse or an Excise Factory (EF).