We refer to the letter by Mr Paul Chan "Puzzled by service charge for GST rebate" (ST Online Forum, 17 Nov 10 ).

Mr Chan asked if third parties such as retailers or the Central Refund Agencies that administer Goods & Services Tax (GST) refunds have the obligation to refund GST in full to tourists.

Tourists may claim GST refunds on their purchases if they make their purchases from retailers who participate in the Tourist Refund Scheme. GST-registered retailers who choose to make GST refunds to tourists may either operate the refund scheme on their own or participate in the scheme through either of the two Central Refund Agencies (CRA), Global Blue or Premier Tax Free.

This scheme is operated as a service to tourists and there is a fee involved. Hence, not the full amount of GST is refunded to the tourists. The retailers and the Central Refund Agencies decide on the fees to be charged. The charging of fees is in line with international practices and common in many countries with GST or Value-added Tax (VAT) such as the United Kingdom & Finland.

Tourists are advised to check with retailers on their refund claim procedures at the time of purchase. For more details on the GST refund process for tourists, please refer to IRAS' website at www.iras.gov.sg.

We would like to thank Mr Chan for his feedback.