There will be no resignations, political or otherwise, in the wake of serious shortcomings at the VAT Department highlighted in an internal report, according to Prime Minister Lawrence Gonzi.
“We already shouldered responsibility when we took action and people ended up in court,” Dr Gonzi said when asked whether anyone would be shouldering political or administrative responsibility.
The report was commissioned by the Finance Ministry in the wake of a fraud scandal that hit the department three years ago leading to convictions against several businessmen and, so far, one VAT employee.
The report, published on Monday, identified “a grave risk” of insider fraud and lack of accountability and risk awareness even though the VAT Commissioner has denied the charges.
Dr Gonzi defended the VAT Department’s head, insisting people who helped catch the culprits should be thanked rather than asked to resign.
“We should not condemn someone who helped unravel this case,” he said when asked whether it was appropriate for the VAT director or management to resign.
The wrongdoing initially came to light after a businessman who had been approached by VAT officials passed on the information to Finance Minister Tonio Fenech, who subsequently referred the case to the police.
Dr Gonzi said all necessary measures had to be taken to improve the administrative processes at the VAT Department to stop fraud from happening and to also act as a deterrent. Speaking in Parliament earlier this week, Mr Fenech said that under recent amendments to the VAT law people caught changing or erasing tax information or fiscal data belonging to a company could face criminal charges.
Using software that could “erase, destroy, damage or conceal any stored information or records, documents or accounts” would expose the user and supplier of such computer programmes to criminal proceedings.
The amendments form part of a series of measures implemented at the VAT Department to address the shortcomings in the report, which was concluded in February last year.