In a recent article dated 7th August 2022 published in the Times of Malta, it informed that many business have been caught recently by the VAT department in failing to provide VAT receipt. It seems that over 250 catering establishment were inspected and one third were caught not giving a fiscal receipt to their customers.
The article states that soon after a similar blitz was held amongst beauticians, nail technicians and hairdressers, where it transpired that half of these businesses failed to issue fiscal receipts to the clientele.
It seems that more inspections covering various sectors will be randomly inspected to cut out such abuse. This is a message that the 2022-elected Commissioner for Revenue Mr Joseph Caruana stated. The Commissioner for Revenue is not only responsible for the administration and collection of Value Added Tax, but also of Income Tax, Duty on Documents & Transfers, and Customs & Excise Duties. The government has plans to crack down these abuses across all economic sectors and intends to bring further discipline and compliance to ensure that it is not losing out further from tax evasion.
Furthermore, the tax man strengthened his resources on enforcement against money laundering and tax evasion. As we wrote in our recent article, Tax Matters: What is an Executive Title?, the Commissioner for Revenue has the right to obtain an executive title against anyone who fails to settle their taxes. Indeed, when tax and VAT returns are not submitted and the tax due is not paid, the individual or the business become in default of their tax obligations. The tax man can therefore initiate legal proceedings and present the individual or business with an executive title by means of a judicial letter.
Tax avoidance and tax evasion threaten government revenues, and ultimately the sums due run into millions of euros. Lost VAT and tax revenues have a negative impact on the government’s spenditure. According to the 2021 Report on the VAT Gap released by the European Commission, EU countries lost €134 billion in VAT revenues in 2019. In this report, it outlines that Malta registers the highest VAT gap increase in European Union, and the country loses out on €287 million in uncollected VAT. To this, the VAT department has now a fully blown investigations centre to lead the fight against tax evasion.
Sciberras Advocates can assist with non-filed VAT and tax returns and challenge any VAT summons and tax intimations. As legal and tax representatives we can deal directly with the tax department lawyers and the courts to contest any executive titles issued.
Article written by Ms Charlene Sciberras, B.A. (Hons), guest writer, is a marketing and business administration specialist with a special focus on corporate, accounting, and legal matters.
Sciberras Advocates founded by Dr Adrian Sciberras, is a law firm based in Malta. The firm prides itself to be multi-disciplinary, innovative and flexible in order to meet the changing times and any challenges in the local and international legal scenario. No matter what private or corporate complex demands are called for, Sciberras Advocates offers practical and cost-effective legal solutions to achieve your desired results. You may reach Sciberras Advocates by phone on +35627795222 or via email on [email protected].