Fiat on/off ramp

For digital payment tokens, no.

According to IRAS e-Tax Guide on GST: Digital Payment Tokens

last revised on 4 November 2019

"With effect from 1 Jan 2020, supplies of digital payment tokens (cryptocurrency that fall within the MAS’s definition of “digital payment tokens”) will no longer be subject to GST. Specifically:

(i) The use of digital payment tokens as payment for goods or services will no longer give rise to a supply of those tokens. That is, if you use digital payment tokens to pay for the purchase of goods or services, you need not account for GST on the use.

(ii) A supply of digital payment tokens in exchange for fiat currency or other digital payment tokens, and the provision of any loan, advance or credit of digital payment tokens will be exempt from GST. Therefore, the supply of such tokens, being an exempt supply, will not contribute to your annual taxable turnover for the determination of your liability for GST registration."

Note that GST still applies to crytocurrencies outside the MAS definition of a "digital payment token".

For initial coin offerings (ICOs), "Taxes on ICO proceeds are dependent on whether the proceeds are considered as revenue and sourced in Singapore." "Generally, for an ICO of a utility token, ICO proceeds will be treated as deferred revenue (and hence taxable under the Income Tax Act). Whereas for an ICO of a security token, ICO proceeds will be capital in nature and thus not taxable."

According to IRAS (Pages)

However, note that "Businesses that buy and sell digital tokens in the ordinary course of their business are taxed on the profit derived from trading in the digital token. Profits derived by businesses which mine and trade digital tokens in exchange for money are also subject to tax."

On the other hand, "Businesses that buy digital tokens for long-term investment purposes may enjoy capital gains from the disposal of these digital tokens. However, as there are no capital gains taxes in Singapore, such gains are not subject to tax."

Fiat on/off ramps will be regulated under the PS Amendment Act.

"Currently, MAS regulates service providers dealing in DPTs and facilitating the exchange of DPTs where the service provider comes into possession of moneys or DPTs under the PS Act. These are common business models of DPT service providers that operate in Singapore."

"The Bill will expand the scope of the PS Act to empower MAS to regulate service providers of DPTs that facilitate the use of DPTs for payments, and may not possess the moneys or DPTs involved. The Financial Action Task Force standards term these service providers as Virtual Assets Service Providers ("VASPs")."

Source: Allen & Gledhill, last revised on 15 January 2021

"Fiat on/off ramps (ie, businesses facilitating fiat-to-crypto exchanges (or vice-versa)) will be subject to regulation under the SFA and/or the PS Act [...]. They will also be subject to enhanced KYC/AML requirements, as they are considered by the MAS to carry higher money laundering and terrorism financing risks due to the anonymity, speed and cross-border nature of their transactions [...].

Under the amendments, the scope of regulated digital payment token services will be expanded to include:
• facilitating the transmission of digital payment tokens from one account to another;
• custodial services for digital payment tokens; and
• facilitating the exchanges of digital payment tokens where the service provider does not come into possession of the moneys or digital payment tokens involved.

Subsequently, these changes will regulate blockchain-related businesses that already offer such services in the market, but are not subject to existing laws under the SFA or the PS Act."

Source: Chambers and Partners, last revised on 8 May 2022

MAS will also be empowered to impose further measures, including "user protection measures on certain DPT service providers to ensure the safekeeping of customer assets held by the DPT service provider".

Source: Baker McKenzie Wong & Leow, last revised on November 2020