A scheme exempting tax on property transfers to set off arrears is unfair, the Chamber of Commerce claimed on Friday.
The chamber was reacting to a new measure that allows those with tax arrears due by January 2021 to pay any tax due on the transfer of property purchased before March 2021 against their arrears.
"This scheme benefits only the defaulters and does not consider those who have their tax payments in order.
"This is unfair on those employers and businesses who pay their taxes when and as due. This legal notice seeks only to proliferate an unlevel playing field in favour of those who are in default and who are in the habit of using their due tax monies as their overdraft facility."
According to the chamber, the legal notice indicates that the government believes tax monies have been used to purchase property, that defaulters do not have the cash to settle tax arrears promptly and that they can only do so if they liquidate some of their property.
"If we do not want to see any more of this cavalier behaviour in the future, we should make sure that people are not able to purchase additional property before they settle their tax arrears," the chamber warned.
"Only then will the exemption from tax on property transfers, which will only be allowed until 31 December 2022 according to the legal notice, be effective in curbing old habits."
The chamber added that those who defaulted on tax payments to finance speculative activities might also delay settlement of trade credit indefinitely to the detriment of businesses that supply them.
"Such practices are extremely damaging and need to be discouraged. It would be good to see schemes designed to help businesses recover their dues from defaulting unrelated parties who are heavily invested in property."
It also reiterated its call to blacklist businesses that did not honour their tax payment obligations.
It said there was no level playing field between businesses that honoured their obligations and those that did not.
Competitive calls must factor this in to encourage more compliance and curb unfair practices, the chamber added.
Independent journalism costs money. Support Times of Malta for the price of a coffee.Support Us