Transport authority to clamp down on widespread car registration abuse

The Malta Transport Authority (ADT) will be clamping down on motorists who register their cars as rental or chauffer-driven vehicles in order to benefit from tax exemptions.

ADT chief executive officer Mario Falzon told The Times that the authority would shortly be launching intensive investigations to curb the abuse, which a spokesman for the authority said was widespread.

He explained that rental cars and chauffer-driven cars - whose number plates end with K and Y respectively - benefit from up to 50 per cent tax reductions. He said the authority had information that some people were requesting K and Y number plates so as to pay less tax, and they did this by registering their vehicle in the name of an owner of a private hire garage. After three years the plates could be changed for those of a private vehicle without the need to pay tax.

"We have requests for 'K' plates for very expensive vehicles, which we highly suspect are not being used as rental cars," he said.

The authority knew of vehicles with full extras and many gadgets, which were registered as chauffer-driven cars. He said: "I don't imagine such a car is being used to drive tourists around."

There are also a number of luxurious four-wheel drives registered as hire cars, and the authority was questioning their authenticity.

People were not realising the risk they were incurring when doing this. Mr Falzon said anyone caught abusing in this way would be fined either Lm500 or double the amount of the tax he was evading, whichever was the highest. He said an offender could also be given a six-month imprisonment sentence, while the garage licence could be withdrawn.

Mr Falzon said a letter was sent to all private hire garages at the end of August, explaining to them the penalties they could incur and also urging them to come into line by the beginning of October.

However, only a few vehicles were switched to private plates from the K and Y number plates during this month. Although Mr Falzon said it was difficult to quantify the number of cars with abusive K and Y number plates, it was not rare to see a very luxurious car with such plates.

He said requests were even made for sports cars to be granted such plates.

"The government had introduced this tax-reduction measure to help the sector and it is not right that it is being abused," he said, adding that this abuse had to be stopped.

Mr Falzon said the authority would go to rental companies and ask them for records of suspicious cars. He said Y-plate cars would also be stopped by the authority's enforcement officers and a new unit focusing on roadside checks, would ask the driver for his tag, which was needed to drive such a vehicle.

He appealed to the judiciary to make sure that penalties given would serve as a deterrent against abuse.