The Commissioner of Revenue is going to contest a ruling by the Administrative Review Tribunal which interpreted a court judgment as meaning that a taxpayer has the right to be considered innocent until proven guilty.

Under normal tax law, contrary to other criminal laws, the opposite applies and taxpayers must prove that the VAT and Inland Revenue’s conclusions are wrong.

The change in interpretation goes back to the landmark 2012 Constitutional Court judgment on the Geranzi case, which said that additional tax was the equivalent of a criminal charge.

Academics and experts had at the time pointed out that this meant tax cases would have to follow the procedural guarantees of criminal cases. But it was not until recently that this point was actually recognised in a judicial context. Magistrate Gabriella Vella, in a VAT case some months ago, referred to the interpretation of the Constitutional Court on additional tax being considered as a “punitive measure” and therefore something that fell under criminal and not tax law.

This meant, she said, that the taxpayer had the right to remain silent and that it was up to the VAT director general to prove that the taxpayer had not paid all his dues.

“We don’t agree with the interpretation of the case. In our humble opinion this interpretation is being taken too far.

“In case of tax matters, Article 6 of the European Convention of Human Rights on the right to a fair trial is not applicable, and therefore, a person cannot challenge their right to a fair trial,” Revenue Commissioner Marvin Gaerty said.

“However, in cases where the administrative penalty is considered as a ‘piena’, then Article 6 becomes applicable. This is what the Constitutional Court decided in its judgment of November 30, 2012.

“Some are extending this interpretation to mean that now all court proceedings are to be treated as criminal in nature, and therefore, in the case of assessments, the burden of proof is to shift unto the Commissioner, and the taxpayer has the right to silence. We obviously do not agree. This position is currently being appealed.

“Let me make it clear that every country in the world has the same approach with regard to tax assessments: that it is up to the taxpayer to prove they are not correct. Think about the implications of an approach where the tax department has to prove that its assessment is correct. If it happened, we might as well close shop and go home,” he said.