TUESDAY, 28 FEBRUARY 2012
PHILIPSBURG–Taxpayers who have acted in bad faith or defaulted on their taxes can see the Tax Inspectorate review their accounts reaching back as far as fifteen years. This was among the answers given to Members of Parliament (MPs) on Monday, based on questions posed on the draft 2012 budget.
United People’s (UP) party MP Silvia Meyers-Olivacce had asked for how many years government could hold a business accountable for payment of old taxes and the consequences for someone who did not meet the tax payment deadline.
The Finance Ministry said that according to Articles 13 and 17 of the National Ordinance on General Taxes, the Tax Inspector could issue a supplementary assessment five years after the end of the calendar year in which the tax debt had originated, in the event the taxpayer had not paid or had paid less than the amount due.
In the event the taxpayer has acted “in bad faith,” the Tax Inspector can go back 10 years. If too little tax has been levied on the component of the taxable object which is held or has arisen abroad, the tax authority can issue an additional tax assessment 15 years after the time the tax debt originated.
The Tax Department has hired new personnel for its collection section and cash department, to alleviate long lines for its clients. The collection officers are being trained. They will be soon handling taxpayers’ files, which will enable the ministry to reach more delinquent clients, which in turn should result in increased revenues.
Further, the ministry said that if a taxpayer does not file a tax return or file it within the legal timeframe, or if the taxpayer has not paid or fully paid, or has not paid within the legal timeframe, this constitutes an omission, for which the Tax Inspector may impose a penalty (Articles 18 and 19 of the National Ordinance on General Taxes).
If it is due to an intentional act/omission/gross negligence of the taxpayer that the assessment issued is too low or otherwise too little tax is levied, or that tax to be paid on declaration is not paid, not fully paid or not paid within the legal timeframe, this constitutes an criminal offence, for which the Tax Inspector can impose a penalty of at most 100 per cent of the tax debt (Articles 20 and 21 of the General Taxes ordinance).
National Alliance (NA) MP George Pantophlet had also asked about the criteria or regulation under which people and businesses could be assessed prior to 2005. The ministry pointed out that this was based on Articles 13 and 17 of the General Taxes ordinance.
There are still outstanding taxes for 2005 owed to government. “It is not possible to determine how much is owed by individuals and companies, due to the fact that it is not separated in our system. There are individuals that have sole proprietorships as well,” the ministry said, in answer to questions on this from Pantophlet.
The actual amount outstanding cannot be determined, according to the ministry, because it is based on tentative assessments. “The collectability of these assessments is based on the actions taken by the Receiver’s Office and the clients themselves.”
Pantophlet had also queried why government was going back three years to collect inheritance tax, when owed.
The ministry said it was for “pragmatic reasons” that Inheritance Tax assessments would only go back three years for now. An officer within the Tax Inspection Department has been appointed for the handling of the Inheritance Tax.