Unpaid taxes, VAT, licences and fees close to €2 billion

Unpaid taxes in Malta have climbed by 20% to €849 million in 2013, over the gross arrears of €708,638,746 reported in 2012.

At least €162 million are owed from before 1998, while €415 million are owed since 1998; another €73 million were owed by employers in final settlement taxes, and €135 million in social security contributions; while the self-employed accounted for €62 million in social security contributions that are still owed.

The IRD has said that some €615 million are uncollectable now, mainly relating to any balances that are older than five years.

Of the €234 million that is deemed to be ‘collectable’, at least €50 million is owed from the years 1994-2008.

Another €908 million in VAT also remains uncollected.

Unpaid motor licences

Transport Malta submitted a balance of arrears amounting to €19.1 million in 2013, which consist of dues for motor vehicle road and driving licences.

€18.7 million alone are unpaid vehicle licences.

None of the outstanding dues were written off during 2013. A substantial amount, €14.8 million have been owed well before 2008 – €10 million alone relates to previous years up till 2004.

Registered owners with accumulated unpaid licences were also given the possibility of regularising their position, benefiting from a reduction in licence and administrative fees, depending on whether the vehicle is scrapped, garaged or has its licence renewed. 

During 2013, a total of 24,751 Notice Letters were sent to owners of unlicensed vehicles, of whom 1,278 (5%) regularised their position in line with the scheme. Out of the total arrears collected of €355,309, the sum of €322,891, consisting of licence fees (€161,232) and administrative fees (€161,659), were collected.

Arrears on unemployment benefits

A total of €18.6 million was also reported due by the Department of Social Protection in arrears on social benefits, a 15% increase over 2012. The amount represents various benefits and assistances overpaid to beneficiaries.

Over 54% of overpayments relate to social and or unemployment assistances. 

TV licences

Arrears falling under the responsibility of the Television Licensing Unit (TVLU) were reported at €10.4 million in 2013, mainly made up of television licences, and just €234,000 in radio communication licences. 

A total of €4,069,513, calculated at 40% of the gross collectable arrears was reported as not collectable; while €189,004, pertaining to 132 radio licences, was also reported as not collectable from companies in dissolution, lack of data and the considerable fees involved to proceed legally.

The TVLU is now in the process of sending a number of legal letters in pursuit of those debtors with the highest balances due, but a number of write-offs are also being considered with respect to immaterial amounts, which have been due for a period longer than five years.