€200m worth of previously lost taxes being collected

Around €200 million in previously lost taxes in Malta are now being collected by the taxman thanks to legislative reforms and a crackdown on evaders, the European Commission has said.  According to the commission’s VAT Gap estimates – the difference between value added tax paid in a country and that which Brussels believes should actually be collected – found that Malta had made significant progress and reduced the gap by some 90%.  Malta’s VAT collection mechanism had previously been dubbed as one of the most inefficient among EU member states, depriving the exchequer of tens of millions of euros in potential revenue each year. A staggering 35% of all expected VAT revenue in Malta went uncollected in 2014, the Commission estimates – with around €240 million not collected on the island that year alone. But according to the latest figures, the uncollected VAT rate has since dropped by around 90% to a more manageable €20 million in 2016. A considerable portion of the decrease has been attributed to changes in what is known as Malta’s VAT liability – the amount of potential tax to be collected. According to Brussels, one of the most important changes that affected VAT estimates in...