STATISTICS (AMENDMENT) BILL

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STATISTICS (AMENDMENT) BILL: Order for Second Reading read.

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3.22 pm

The Minister of State for Trade and Industry (Mr Raymond Lim Siang Keat): Mr Speaker Sir, I beg to move, "That the Bill be now read a Second time."

The Department of Statistics has the responsibility to compile and analyse data on the Singapore economy and households to support policy-making and to meet the statistical requirements of international organisations, businesses, analysts and the general public. In order to discharge this responsibility, the Department has to collect a wide range of data from businesses and persons. In the past, much of the data was collected through statistical surveys. As such surveys are costly and labour-intensive, the Department has increasingly tapped on administrative data to supplement the survey data. The use of administrative data helps to reduce the burden on respondents, improve operational efficiency in statistical compilation, and increase the range of statistical analysis available for policy-making and business decision-making.

Need for Taxation Data

Taxation data is an important administrative data source for the statistical system in many developed countries. Canada , US, the Nordic countries, New Zealand and Australia have legislative provisions to allow their national statistical offices to access individual taxation data for statistical purposes. Besides providing personal and household incomes, taxation data can be used for benchmarking and estimating national economic accounts, creating new business activity indicators, estimating the income and expenses of small businesses, and updating the list of businesses for use in statistical surveys.

Singapore will also benefit from the use of taxation data for official statistics.

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More useful and timely data can be compiled without imposing additional survey burden on companies, businesses and households. For example, the monthly Goods and Services Tax (GST) data will enable the Department of Statistics to derive improved estimates of turnover and value-added at a more disaggregated level. Corporate income tax data will provide the basis to adjust for under-coverage of small and medium-sized enterprises and to compile estimates of small sectors that are not adequately covered by surveys, such as agriculture and construction. Personal income tax data will help to fill data gaps in the analysis of households' income from self-employment and non-work sources.

Data Safeguards

Stringent standards are in place to ensure the confidentiality of individual taxation information provided to the Department of Statistics for statistical compilation and analysis. Under the Statistics Act, the taxation data can be used for statistical purposes only. Individual particulars cannot be disclosed without the prior written consent of the individual concerned. Only aggregated data can be released, so that no individual can be identified in the aggregated data. Moreover, the Act does not permit individual particulars of taxpayers to be disclosed without the permission of the Comptroller of Goods and Services Tax and the Comptroller of Income Tax. Any officer found guilty of breaching any of the confidentiality provisions in the Statistics Act is liable to severe penalties.

The Department of Statistics also has strict administrative measures to ensure security of taxpayer information during data transfer, processing and storage. For example, the taxation information will be encrypted before being transmitted via secure mail to the Department. And it will only be processed by the Department's authorised staff.

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Legislative Amendments

The Department of Statistics currently does not have the legal authority under the Statistics Act to obtain taxation information for statistical purposes. It is an anomalous situation, because the Department can request information from gazetted Research and Statistics Units and other specified competent authorities, namely, the Central Provident Fund Board, Director-General of Customs and the Superintendent of Census.

The Statistics Act therefore needs to be amended to allow the Department of Statistics access to relevant individual taxation information on companies, businesses and persons.

Clause 2 of the Bill removes the current prohibition on the Chief Statistician to access information obtained under any written law relating to taxation.

Clause 3 provides for the amendment of the Third Schedule to include particulars and information obtained under any written law relating to taxation. But this is only to the extent that the supply of such particulars and information is permitted by or under that written law.

Clause 4 includes the Comptroller of Goods and Services Tax and the Comptroller of Income Tax as competent authorities in the Third Schedule for the provision of information obtained under the Goods and Services Tax Act and the Income Tax Act respectively.

Clause 5 makes consequential amendments to the Goods and Services Tax Act and the Income Tax Act. The consequential amendments empower the Comptroller of Goods and Services Tax and the Comptroller of Income Tax to furnish, and permit the Chief Statistician access to, the specific types of tax information and records to be prescribed

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in subsidiary legislation made under the respective Acts.

Mr Speaker Sir, the proposed amendment to the Statistics Act will allow Singapore to benefit from the use of taxation data for official statistics. Significant improvements in the Government's statistical system will be realised, and the survey burden on the business community and households reduced.

Sir, I beg to move.

Question proposed.

Mr Low Thia Khiang: I would like to ask the Minister of State whether the Government considers privacy as an issue in this amendment.

Mr Raymond Lim Siang Keat: As I mentioned in my speech just now, it is an important issue, and that is why there is a confidentiality provision worked into it, to ensure that the information itself is kept confidential. So, as I mentioned just now in my speech, there are various provisions for severe penalties for any officer who releases that to an unauthorised person.

Mr Low Thia Khiang: Clarification, Sir. Is the Minister of State aware that when the same Act came to Parliament for amendment in 1990, the information on taxation was purposely left out for reasons of concern with privacy, and the then Minister of State, who was moving that amendment in the House in 1990, said:

"Information obtained under legislation relating to taxation or legislation administered by the MAS are specifically excluded. This is to preserve privacy of sensitive information."

So, I would like to know what has changed and why the change of mind of the Government in the position in terms of

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the issue of privacy. In 1990, it was a concern and thereby it was excluded. But, now, taxation information, such as individual taxation information, is to be made accessible to the Department of Statistics, whatever safeguards notwithstanding. But the fact is that it is now to be accessible. So, why the change of mind?

Mr Raymond Lim Siang Keat: I do not think this is a question of a change of mind. I think it is a matter of balancing the interest of statistical analysis to ensure that Singapore keeps up with international best practices. It would give us more timely analyses of data, and we have to weigh that against the need for confidentiality. As I said, there are various safeguards. Let me just take Members through them, so as to give you some comfort on what we are doing here.

There are three ways in which we are controlling and ensuring confidentiality, ie, legal, administrative and technical measures. On legal measures, under the Statistics Act, no individual particulars can be disclosed without the prior consent, in writing, of the individual company or person. Should any officer disclose any information contrary to the Statistics Act,

he shall be liable upon conviction to a fine not exceeding $5,000 or to imprisonment for a term not exceeding 12 months or to both. At a more general level, the Official Secrets Act prohibits release of official information to unauthorised persons. An officer guilty of releasing official information to unauthorised persons shall be liable on conviction before the District Court to a fine not exceeding $2,000 and to imprisonment for a term not exceeding two years. The officer may, with the sanction of the Attorney-General, be tried before a Magistrate Court, and such persons shall be liable on conviction to a fine not exceeding $1,000 and to

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imprisonment for a term not exceeding six months.

Administrative Measures

Strict controls are in place to ensure that access to information is given only to authorised Department of Statistics (DOS) staff. Protocols are established on data transfer, processing, storage and utilisation to ensure data security. Arrangement is made for secured courier or authorised staff to personally collect the CD-R from Inland Revenue Authority of Singapore (IRAS).

Technical Measures

Firewalls, physical separation of internal and external systems and other IT installation devices protect the security of DOS' computer systems and databases. Arrangement is made with IRAS to encrypt the data sets provided to DOS.

Mr Low Thia Khiang: Clarification, Sir. I am aware, and I am sure that many Members are aware, of these safeguards. But the question is: why is there a need to include sensitive information on taxation of individuals in the Bill? Is the Minister of State saying that in the past because these were not included, and thereby, our statistical data were not coherent and not up to international standards? I know he is talking about balance but why is there a compelling need to include individual taxpayers' data to be made accessible for statistical purpose? What is the reason?

Mr Raymond Lim Siang Keat: Sir, actually, I have answered that question. The key reason is that we want our statistical analysis to be more comprehensive and complete. Survey data is not complete enough. And having administrative data, like taxation data makes it much more comprehensive and much more timely.

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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 Raymond Lim Siang Keat].

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