CUSTOMS (AMENDMENT NO. 2) BILL

Order for Second Reading read.

5.58 p.m.

Mr Ramaswamy (for the Minister for Finance): Mr Speaker, Sir, I beg to move, "That the Bill be now read a second time."

Sir, earlier in the year, the Customs (Amendment) Act, 1966, was enacted to conform to the constitutional changes and to make improvements in customs administration and facilities in the light of past experience.

This Bill seeks to make further modifications to the Customs laws to provide for and to take account of the future establishment of free trade zones in Singapore. Provision is also made for the introduction of duty-free shops to operate in the City outside any free trade zone, and for their regulation and control.

I shall now deal with the more important clauses.

Sir, clause 3 of the Bill changes the definitions of "dutiable goods", "export", "import", "goods", "value" and introduces three new definitions: "customs territory", "free trade zone" and "tourist", to accord with the replacement of the existing free port status by a principal customs territory and a free trade zone or zones. "import" no longer means the bringing of goods into Singapore but into "customs territory" from any place outside, including any free trade zone. Goods genuinely in transit are not included as such goods will be within any free trade zone and outside customs control. Likewise, "export" will not mean taking of goods out of Singapore but out of "customs territory" to any outside place including any free trade zone. The term "value" is amended to specify equitably that customs duties and charges incurred on wharf handling, storage, removal and so on, incurred in a free trade zone are not to be included. To ensure that the sale of dutiable goods in duty-free shops is made to bona fide tourists, "tourist" is defined to mean any person, including persons in transit, whose entry into Singapore is dependent upon the presentation of a passport or other travel document, and whose stay in Singapore does not exceed six months.

Clause 4 of the Bill provides for customs and excise duties to be levied on any goods imported into the "customs territory" which refers to Singapore and her territorial waters, but excludes any free trade zone. The present section 11 (1) will thus be superseded as it would be inadequate when free trade zones co-exist with the "customs territory". Free trade zones, of course, will be areas declared for that purpose under the Free Trade Zone Bill, which accompanies this Bill.

Clause 6 amends section 22 of the principal Ordinance to put beyond doubt the time at which customs controls may be imposed on imported or exported goods. Controls may be imposed at the time goods enter or leave the "customs territory'.

To direct control of all dutiable goods, clause 7 of this Bill replaces section 45 of the principal Ordinance and will enable the Comptroller of Customs to require the landing of all dutiable goods, or mixed cargoes of dutiable and non-dutiable goods, in any free trade zone, designated warehouse or customs premises.

Section 53 of the principal Ordinance is repealed and replaced by clause 10 of this Bill to allow dutiable goods for transhipment to be deposited in a free trade zone. This is necessary to protect transhipment trade and reduce the risk of such dutiable goods being smuggled into customs territory for domestic consumption.

Clause 11 is designed to safeguard the tourist trade by providing for licensed duty-free tourist shops and to regulate their operation.

Clause 12 provides for action against tourists who abuse the privilege of purchasing at duty-free tourist shops.

Provision is also made in this Bill for the establishment of a new kind of warehouse known as "licensed factory warehouse" to enable manufacturers in the customs territory, wherever permissible, to store dutiable materials used in the manufacture of their products for the domestic and export markets, without payment of duty, but subject to customs requirements.

Sir, I beg to move.

Question put, and agreed to.

Bill accordingly read a Second time and committed to a Committee of the whole House.

The House immediately resolved itself into a Committee on the Bill. - [Mr Ramaswamy]

Bill considered in Committee; reported without amendment; read a Third time and passed.