€339,793 in payments to local councils not covered by fiscal receipt

Payments totaling nearly €340,000 paid to Malta’s 68 local councils were not accompanied by a proper fiscal receipt, according to a report issued by the Auditor General. A further €78,387 in payments to regional committees were also not covered by receipts. 

This represents a sharp decrease from the €1.6 million in payments not covered by a fiscal receipt flagged by the auditor in last year’s report but still represent “substantial amounts” the auditor pointed out.

The locality accepting the highest number of payments not accompanied by a fiscal receipt was one of the smallest in the country – Mtarfa in Malta. According to the AG’s report, payments to the Mtarfa council not accompanied by a proper fiscal receipt amounted to €53,223.

The Gozo regional committee’s payments which were not covered by a receipt amounted to €55,053.

The report states that despite the continuous recommendations made by the AG’s office during the preceding years, instances were still noted in which a substantial amount of expenditure incurred for councils operations was not supported by a valid fiscal receipt, even though the service provider concerned did not qualify for an exemption. 

At times, even the invoice submitted by the supplier lacked necessary details, such as the identification of the client, while in a number of cases procurement was only supported by “a piece of paper”. 

According to the auditor local councils are to ensure that an invoice, as well as a fiscal receipt, is obtained for all the expenditure incurred by councils. In cases where the supplier is in breach of VAT regulations, the council is to discontinue procuring from such defaulter until the situation is rectified. 

A number of councils, including Mtarfa and Naxxar, did not reply to the auditor’s reproach while others like Mgarr replied that while they do their utmost to request such receipts for all payments issued, a number of suppliers do not forward fiscal receipts despite the council’s efforts. 

The Dingli council promised to ensure that a valid fiscal receipt is obtained for all expenditure incurred while the Rabat (Malta) council replied that this matter is beyond its control. The Victoria council, which accepted €51,725 in payments not covered by a proper receipt, replied that the council always stamps all payment vouchers with the statement saying ‘Victoria Local Council – Please issue Fiscal Receipt’. 

The Sliema council, which found itself unable to recuperate receipts for payments amounting to €3,261 (down from €64,786 last year), remarked  that although it makes every effort to recover the fiscal document “certain suppliers are happy to break the law.” In view of this the council intends to “blacklist” from future procurement orders suppliers who do not provide it with a fiscal receipt.

Payments to local councils lacking proper fiscal receipt

Mtarfa                     €53,233

Naxxar                    €52,127

Victoria                   €51,725

Mgarr                      €35,794

Xaghra                    €34,725

Dingli                      €33,250