Keith Zahra, communications coordinator, Ministry of Finance, the Economy and Investment Valletta
VAT on car registration not illegal
I refer to the article Car Owners Can Claim Illegal VAT Refunds (February 25). This article gives the impression that according to the European Commission, car owners who bought cars since accession and paid VAT on registration may claim a refund as the tax was charged against EU laws.
This statement is incorrect for two principal reasons.
Firstly, Commissioner Laszlo Kovacs's statement indicated that the European Commission is at present undergoing an evaluation of the new legislation adopted in terms of car registration. Nowhere had it defined any tax as illegal. Secondly, there was no decision by the European Court of Justice that states that the car registration tax system in Malta was illegal. Even more, the European Commission, despite producing a reasoned opinion on the matter, has never opened a case against Malta in the aforementioned court to obtain a decision describing the Maltese law on car registration as illegal.
Popular Stories
In Discussion
11 Comments
Post comment
Please sign in or create your Account to post comments.
colin wilcox
Feb 27th 2009, 17:28
If the dealer or purchaser of any goods is vat registered they claim the vat already paid back when they pay there vat
J Stivala
Feb 27th 2009, 17:13
another thing who really said this "tax on tax is illegal thing?" what about alcohol? we pay excise and VAT on the whole price including excise. so the issue must be something else
J Stivala
Feb 27th 2009, 17:09
@Kurt Mifsud, It is true that this legislation is based on value, CO2 and length and the larger and the more CO2 is emitted, the more registration tax is due. However it evident to all that vehicle prices have gone down. INCLUDING those vehicles which have large CO2 efficient vehicles .
Louis Mifsud
Feb 27th 2009, 16:15
Does this Government have a 'death wish'?. It seems that everything they do or say these days is contrary to public opinion. Whatever happened to 'Government for the people'?.
laurence schembri
Feb 27th 2009, 13:58
Keith Zahra, stop scribbling rubbish, it is ILLEGAL to pay VAT twice on the same object...no matter what. tell you boss to go over the VAt issues and regulations.
lgalea
Feb 27th 2009, 13:52
Arrogance unlimited by those who stole peoples money.
Johnny Smith
Feb 27th 2009, 13:17
@Keith Zahra: Please note that according to an EU press release IP/08/135 dated 31/01/08 note that the commission understand that the car taxes levied in Austria, Malta and Finland, despite some minor or ancillary differencies, are basically identical to the Danish one examined by the Court.
Thus, all of them are one-off taxes which are payable on the acquisition of the m/vehicle or as a condition for bringing it into use on the territory of member state. The commiss has already initiated infringement procedures against Poland and Portigal concerning same matter(IP/07/1003). That these rules on taxable amount of VAT have been harmonized at the EU level,and given the uniform application of those rules is an essential condition for the proper operation of the VAT system, and taken the view that the criteria of the EC Court Case C-98/05 must be applied to the car taxes levied in Austria, Malta, and Finland.
Member states had three months to bring their legislation in conformity with the Community law.. ................1/2
Kurt Mifsud
Feb 27th 2009, 12:50
Just playing with word Mr Zahra! As far as everybody is concerned that was double taxation asVAT was paid in 2 different EU countries. If I buy an item from ebay located UK I pay for the UK VAT and I don't pay VAT again when it arrives here.
One more think Mr Zahra, I'm sure you are reading this. What about the 'revision' of the registration tax of big engine vehicles like BMW's and high powered vehicles like Mitsubishi EVO, Honda Integra, etc? Is it true that once this issue is settled their price is going to rocket to the sky, some by even up to 75%? I heard this from 2 different local dealers after a meeting between them and the govt representatives which was held a few months ago.
If this is true then all the govt is going to revise is for the benefit of the dealers again and not for the sake of the environment. I will mark and take your words on this!
S. Calleja
Feb 27th 2009, 12:42
Illegal or not, it was definitely a case of double taxation. Now, if the end justifies the means... people still think it's unfair to be taxed twice on the same purchase, so even if nobody gets back a single cent, morally this is wrong. And everybody knows it, including the politicians involved.
I'd rather if I hear: "Yes, people are right to complain since they were taxed twice. But because this did not break any laws, we are not obliged to return the funds, and we shall not." That would have at least been an honest answer.
J.Borg
Feb 27th 2009, 10:13
How are we to belive the minister's statement.
That registration tax was paid by the importer and vat was paid by the buyer.
Can anyone explain to us then who finally paid for everything, as i don't think the importer didn't include the registration tax in the final price of the car.
This is just simply playing with words.
David Wain
Feb 27th 2009, 10:13
As cynical as one can get!!