Former Nationalist MP Thake breached ethics, public life standards in unpaid VAT probe

Standards Commissioner George Hyzler concluded that former PN MP David Thake breached both the Standards in Public Life Act and the Code of Ethics of Members of Parliament over his companies’ failure to settled unpaid VAT and for not declaring his shareholding in a company in the declaration of assets.

In January 2022 PN MP David Thake resigned from parliament after it was revealed that his telecommunications company, Vanilla Telecoms had a pending VAT bill of €270,000 with the Inland Revenue Department and that his other company Maltashopper Ltd owed over €500,000 in VAT.

“I am guilty of having made an administrative mistake as a company director – more than that, I’m not guilty of anything… I was clear and transparent with all the facts when the press ran this story… honesty is my hallmark,” Thake had said.

But it was Thake himself that wrote to the Standards Commissioner, asking him to investigate the matter.

In his report on the case, Hyzler noted that Thake said his unpaid VAT dues were down to a lack of liquidity in both his companies. Thake said that in the case of Vanilla Telecoms, many clients were no longer operating, with the issue escalating during the pandemic. But he said he had no clear indication of how much VAT was due as the last statement he had received from the IRD was in 2016 and that he was never asked to settle the amount.

Thake said that in the case of Maltashopper Ltd, the unpaid VAT was accumulated in between March 2020 and August 2021, and that it was covered by the COVID-19 Fiscal Assistance scheme.

But Hyzler also noted in his report that Thake had failed to mention his 50% shareholding in Davmar Holdings Ltd, in his 2020 declaration of assets as MP. “Whatever the reason, the fact remains that Thake failed to observe his obligations and declare the company in his declaration of assets as a member of parliament, breaching the Code of Ethics of Members of Parliament,” Hyzler stated. He added that this was a direct breach of his ethical obligations as an MP.

Hyzler said that MPs should lead by example and follow the law when it comes to tax payments. He stated although it is a common practice for enterprises to fall behind on tax payments, and that it was tolerated by the authorities, an MP had to set a good example.

Hyzler noted that Thake admitted “grave shortcomings” when failing to submit the annual returns for Maltashopper Ltd for 10 years straight.

“It is clear that deficiencies that go back to 2012 were only being addressed this year in light of the publicity there were given. The shortcomings of Thake in the management of his companies are in violation of the law, so much so that he himself initiated the process of in order to reach an agreement with tax authorities for the settlement of the due taxes,” Hyzler stated.

The Standards Commissioner acknowledged that Thake’s resignation from Parliament and his decision to not contest the March general election, had to be taken in consideration. “The resignation of Thake from an MP represents a public recognition for his shortcomings and the highest price he could have paid for his as a public person.”

Hyzler declared the case as closed.