A few days ago, on November 5, a legal notice was slipped through silently and without any publicity.
Legal Notice 419, entitled ‘Exemption from Tax on Property Transfers Rules (Set-off of Tax Arrears)’ allows those who still owe tax arrears in January 2021 to pay any tax due on the transfer of property purchased before March 2021 against their arrears.
This actually means that these tax defaulters will be exempt from paying tax on property transfers to the extent that they are in arrears.
This legal notice went completely unnoticed had it not been for the Chamber of Commerce that brought it to public attention. The chamber noted that “like every other scheme intended to bring taxpayers in order, this scheme benefits only the defaulters and does not consider those who have their tax payments in order.
“This in itself 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”.
This government scheme exempting tax on property transfers to set off arrears is nothing less than another dirty scheme set up by a dishonest government in order to favour those developers who have defaulted on tax and social security contributions for years on end.
Basically, the authorities are encouraging the ‘żviluppaturi tar-raba’ sular’ (‘developers on the fourth floor’) to break the law for decades on end by not paying income tax, VAT and social security dues.
Not only will these tax defaulters not be punished and fined for their wrongdoing but the ‘Joseph Abela Robert Muscat’ government will even reward them for their non-observance of the law.
It is not only the Chamber of Commerce that was horrified at this scam-scheme proposed by the government.
The Malta Institute of Taxation and the Institute of Financial Services Practitioners, as quoted in the Times of Malta, noted that “if at all possible, the injustice inherent in this amnesty is all the more nefarious as the rules apply selectively favouring defaulting taxpayers who own immovable property situated in Malta acquired on or prior to March 31 and who choose to dispose of such property before the end of this year. Why the government has seen fit to promulgate these rules at the current time is beyond our comprehension.”
This legal notice will enable the PL and PN to settle their multiple years-old debt to the government- Arnold Cassola
The Malta Institute of Accountants is also up in arms against this abominable discrimination against honest businesses and citizens.
It has reiterated that “this measure is tantamount to a tax amnesty and is a slap in the face to all professionals and entrepreneurs who operate their business in full compliance with legal and ethical considerations, while rewarding defaulters who abusively failed to pay their dues towards society”. Ironically, even the MDA also dissociated itself from this decision.
It is heartening to see these organisations of professional bodies behaving in such a responsible way and denouncing the jungle of tax injustice that exists in our country, a jungle where the cowboys are rewarded and the honest ones penalised.
However, an even more serious effect of the legal notice seems to have escaped one and all. The legal notice passed through by stealth is not only an ‘escape from jail’ gift card donated by the government to those developers who have defaulted on tax and social security contributions.
This legal notice or, better still, the icing on the cake, is actually tailor-made for the PN and PL as well. It will enable the two parties to, finally, settle their multiple years-old debt of millions of euros to the government.
Through this dirty scheme, the PN and PL can, for example, sell off Australia Hall or a couple of their każini, without having to pay any of the stamps, duties and fees, which all normal citizens are legally obliged to pay, when operating such transactions involving the sale of immovable property.
Basically, the PN and PL are being rewarded for having broken the law for years on end. And they are being spared all the fines due.
This is blatant hidden state aid to the PN and PL, which, in reality, are being bailed out by the Maltese taxpayer.
The whole honest part of the population of Malta that has regularly paid its taxes should be up in arms to ensure that Legal Notice 419 is immediately repealed.
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