Lawmaker Ron Lam
Local small and medium enterprises (SMEs) are struggling to comply with recent requirements from the Financial Services Bureau (DSF). This requires business owners to provide additional proof of their receipts and expenses related to a financial assistance program launched during Covid-19.
On the line is an inspection decided by the bureau for those granted government support measures between 2020 and 2024.
Lawmaker Ron Lam wrote to the government that the DSF recently required business owners to present proof of their activities from 2020 onwards. Many without an organized accounting system are struggling to comply with this requirement.
“Several merchants have reflected that they have recently received notices from the DSF requesting them to provide all the receipts and information of the year when the assistance was granted to prove that they are eligible for tax returns, but due to the lapse of time, merchants are unable to collect and provide all the receipts,” Lam said, adding that due to this incapacity, there are being considered ineligible for tax refunds and are asked to return the sums of the assistance received.
Lam claims that the government has many ways to verify merchants’ honesty and reports, but this method only burdens small business owners.
In response, the DSF noted that three assistant schemes launched from 2020 to 2022 had specific and clear rules that those professionals and companies had to comply with.
“To expedite fund distribution, the government has implemented clear policies focused on ‘trustful distribution with subsequent oversight,’ using pre-screening and post-monitoring to ensure funds reach eligible beneficiaries. The program also emphasizes responsible resource use as the DSF verifies beneficiary eligibility, and those who submit false information or commit fraud will have their funds revoked and may face legal consequences,” the response notes.
DSF director Iong Kong Leong added, “if discrepancies are found in accounting records during the five-year settlement period, the bureau can assess the taxable income of business operators and determine the tax owed.”
In light of this, Iong noted that Article 49 of the Commercial Code, which requires operators to maintain accurate accounting records for five years, is why he considers DSF fully complying with the law and ensuring that public money is well spent.
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