In a striking development in Singapore, a 64-year-old undertaker named Tee Siew Gim has been sentenced to 21 weeks in jail, alongside a hefty penalty exceeding S$340,000 (approximately US$250,000) and an additional fine of S$3,000 for serious tax evasion charges. This legal battle marks Tee as the fourth undertaker to face prosecution due to tax offences since the government began intensifying oversight of the funeral industry.

The scrutiny began in earnest back in 2019, when the Inland Revenue Authority of Singapore (IRAS) launched an extensive investigation into the funeral sector, encompassing essential services like embalming, religious rites, and catering. So far, IRAS has scrutinized 65 businesses within the field, recovering over S$3 million in unpaid taxes and penalties from around 49 operators.

The nature of funeral services often involves significant cash transactions, with many businesses lacking proper record-keeping and internal controls, leading to a higher risk of tax compliance failures. For instance, businesses are mandated to register for Goods and Services Tax (GST) when their taxable turnover exceeds S$1 million annually.

The Fall of Tee Siew Gim

Tee's downfall started with an investigation where it was revealed that he purposefully misreported his income on tax returns for the years 2018 and 2019. Instead of the actual S$374,646, Tee reported only S$146,673 in 2018 and contrived a similar fallacy for 2019, leading to undercharges totaling around S$101,000 in taxes. Further investigation unveiled that Tee failed to register his business, Hock Hin Undertaker, for GST, thereby accumulating an unpaid GST liability of over S$364,000.

Additionally, Tee was involved in aiding others, enabling individuals like Tan Ah Kiew and Tee Siew Kheng to evade taxes by crafting false entries in their tax returns. His involvement in such elaborate schemes exemplifies a troubling pattern of corruption in the industry.

His defense attorney requested the court allow his sentence to start after Chinese New Year, emphasizing Tee’s prior restitution of the full owed taxes. The court acquiesced to both requests, allowing him to fulfill community obligations before commencing his sentence.

Scandalous Patterns: The Other Undocumented Undertakers

1. Roland Tay of Direct Funeral Services: At 77, Roland Tay was punished last September with a S$12,000 fine and a staggering penalty exceeding S$529,000 for tax-related offences. Known for his pro bono arrangements for murder victims, Tay was found guilty of underreporting income across multiple years, resulting in over S$250,000 in undercharged taxes.

2. Grace Tay of Grace Casket: The 40-year-old was sentenced to 25 days imprisonment and fined S$75,000 in December 2022 for substantial tax evasion. Grace creatively concealed over S$600,000 in income within a two-year period, only admitting to minimal business activity during an IRAS audit.

These incidents shed light on a broader initiative by IRAS, which has uncovered systematic tax evasion practices across Singapore’s funeral services sector, prompting a determined crackdown. Authorities are particularly concerned with the high volume of cash transactions and the potential for underreporting income.

The repercussions of these cases extend beyond individual penalties, significantly shaking public confidence in ethical practices within the funeral service industry. As IRAS continues its vigilance, business owners in the sector are left to ponder the long-term implications of evading tax responsibilities.

Stay tuned for more updates on this unfolding story—what does this mean for the future of the funeral industry in Singapore?