A spokesman for the Finance Ministry has rubbished claims by PN MP Robert Arrigo that people were being overcharged on their income tax.
Last week, Mr Arrigo said in Parliament that he received information about people in the €19,501 to €35,000 income bracket being overcharged.
He said the government was taxing people in that particular income range at 26 per cent rather than 25 per cent.
Mr Arrigo said he had confirmed with a number of accountants that the government was charging more than 25 per cent in the income range he mentioned.
READ: People being overcharged on their income tax, PN MP claims
He pointed out that almost a week after making his claims, the government had yet to clarify the matter.
Contacted by the Times of Malta, a Finance Ministry spokesman argued that the 26 per cent tax bracket did not exist and that the allegations made by Mr Arrigo were completely untrue.
The 25 per cent rate was due to a change in the method of computation following the 2015 Budget
Citing information available on the Inland Revenue website, the spokesman said there were two brackets that were taxed at the 25 per cent rate.
The spokesman said this was due to a change in the method of computation following the 2015 Budget, in which those earning less than €19,500 benefitted from a higher zero-tax bracket, that is, €0 to €9,100 instead of €0 to €8,500.
He explained that this bracket was divided in two so that those who already benefitted from the reduction in tax from 35 per cent to 25 per cent would not benefit from a higher zero-tax bracket.
The income tax brackets were revised by the present government after reductions were promised by the previous, Nationalist administration.
Income tax was cut for mid- and high-income earners. Income tax in the bracket in question was reduced to 32 per cent in 2013, 29 per cent in 2014 and then the present 25 per cent in 2015.
The Central Bank’s economic predictions for 2016 to 2018 indicated that favourable economic conditions, income from the government’s passports scheme and other indirect tax measures had helped offset the impact of the income tax reductions on the government coffers.