Mark Micallef
More people may be charged over VAT fraud
Police are expected to file charges against more people in relation to the €10 million fraud at the VAT department, The Sunday Times has learnt.
To date, charges have been filed against six VAT department employees, five men thought to be 'go-betweens', as well as 20 businessmen. But police have now broadened their investigation - questioning a number of auditors and financial specialists.
The men behind the scam face up to 10 years in prison, though any businessmen who are convicted are likely to receive lighter sentences.
According to police sources, when the scam began, four main actors were involved - a department official, a businessman whose relative worked at the department, and two individuals who acted as middlemen.
They took advantage of clients' ignorance of the fact that it was government policy to waive fines for late payment of VAT dues, and were taking bribes for doing so.
Eventually, however, the fraud became more complex, with different department officials working to waive money that businesses owed the department.
In some cases, they would even tamper with figures in such a way that instead of being in arrears with the department, companies would end up being owed money.
The department ended up owing more than €370,000 over just two years to one company that was meant to be in debit.
The police raided the department on April 3 following three months of investigations that were triggered by a businessman who brought the fraud to the attention of Finance Minister Tonio Fenech.
Mr Fenech has said he will wait for an internal audit to be completed before deciding whether to take disciplinary action against any senior department officials who failed to detect the fraud.
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Karl Abela
Aug 24th 2009, 09:46
This has undoubtedly earned the governement a 'no messing about' attitude. It's time to hear those cash registers ring more.
Michael Neville Cassar
Aug 24th 2009, 08:37
Having read the comment of E.Azzopardi and S Calleja I ask why the Vat department has to take them to court. It should be given legal outright for the department to confiscate, and to close down a business say for 1, 2, 3, months according to the aggravation of the case, harsh enough to make the individual give the VAT collected.
Also confiscation of personal property other then the company as needed.
E. Azzopardi
Aug 23rd 2009, 21:06
This is never ending. I hope the amount will not keep increasing by the hour now.
Having said what we all had to say, I firmly believe, that the vast majority of the Maltese citizens, who are definitely honest people, will now want to see that those who are found guilty will get the maximum punishment. Here we are, with many families struggling due to various reasons and others taking "the people's money' to get rich or not to pay tax due.
How can these poeple be so naive and yes so stupid to think that they could go without one day being caught? Thank God for this honest businessman. Thank you once again.
S. Calleja
Aug 23rd 2009, 15:05
@ Michael Neville Cassar
"The system can be efficient enough by returning his/her account with his cash register total printed computation at end of the month if not they are charged interest rate as per sum computed."
The system works very similarly to how you described it, but the period is 3 months not one. However if the VAT registered person/business does not pay, nobody is going to force the persons involved to pay the VAT due unless legal action is taken against them. The system relies on the many honest persons who pay VAT due in time, and hefty penalties and interest rates to discourage people from abusing the system.
Paul Barrett
Aug 23rd 2009, 14:44
The men behind the scam face up to 10 years in prison, though any businessmen who are convicted are likely to receive lighter sentences.
Does this mean that the businessmen will get nine and a half years - must be the year of the flying pig.
Michael Neville Cassar
Aug 23rd 2009, 12:28
I and many others like me are deducted tax every month yet vat is not collected each month, my question is why? The system can be efficient enough by returning his/her account with his cash register total printed computation at end of the month if not they are charged interest rate as per sum computed.
S. Calleja
Aug 23rd 2009, 11:36
@ Paul Micallef
"My tax is diducted automaticaly from my wage, when i buy something from a shop i pay VAT, so how come that, this amount is due to the vat dep, from MAMBRA???"
For an explanation of how VAT works: http://en.wikipedia.org/wiki/Value_added_tax
Also, when tax is "diducted" from your wage, it is still the responsibility of your employer to pass it to the Inland Revenue.
Paul Micallef
Aug 23rd 2009, 10:20
Can some one please tell me, if this DEPARTMENT is run by cowboys from TOP to bottom??
How come that MAMBRA owes 380.809 Euros VAT????
My tax is diducted automaticaly from my wage, when i buy something from a shop i pay VAT, so how come that, this amount is due to the vat dep, from MAMBRA??? Gonzi should do something about this and not keep telling us that all is well, and the Police are investigating, his goverment has put the DIRECTORS that are in charge there,so they should answer, but NO, the little firsh get it, what a Pathetic situation.