Malta’s tax and customs administration has introduced a major milestone in its ongoing efforts to bolster tax compliance and modernize its operations, revealing that over €375 million in tax arrears was collected in 2023. Tax Commissioner Joseph Caruana, talking completely to The Company Occasions, make clear the administration’s strategic initiatives and achievements in navigating the intersection of fiscal coverage, expertise, and compliance.
Marking his second anniversary on the helm of Malta’s income physique, Caruana emphasised the administration’s dedication to combatting uncollected taxes, narrowing the VAT hole, and enhancing general compliance charges. Central to this endeavor is the adoption of Compliance Threat Administration ideas, coupled with rigorous Enterprise Course of Reengineering efforts aimed toward modernizing and streamlining administrative processes.
Reflecting on the challenges and alternatives inherent within the transformation journey, Caruana highlighted the merger of Malta’s key income departments as a pivotal step in the direction of enhancing compliance and effectivity. The mixing of earnings tax, VAT, and customs capabilities has facilitated synergies in danger evaluation, information administration, and coverage improvement, yielding tangible enhancements in compliance charges and taxpayer engagement.
Notable achievements embody a marked enhance in on-line tax submitting and cost charges, with a 12% rise in on-line returns and 53% of particular person taxpayers choosing digital cost strategies in 2023. Furthermore, company tax compliance has seen notable enhancements, underscoring the efficacy of digitalization and built-in compliance measures in driving behavioral change amongst taxpayers.
Crucially, Caruana emphasised the idea of compliance by design, advocating for the seamless integration of compliance necessities into the material of administrative processes. Leveraging cutting-edge expertise, together with Synthetic Intelligence (AI) and machine studying, the administration goals to bolster danger administration capabilities and streamline enforcement efforts, thereby enhancing general effectivity and effectiveness.
Trying forward, Caruana outlined the administration’s bold agenda, which incorporates the implementation of real-time reporting mechanisms and the event of an Built-in Tax and Customs System (ITCAS). These transformative initiatives, supported by important investments and strategic partnerships, underscore Malta’s dedication to fostering a contemporary, clear, and resilient tax ecosystem.
As Malta continues its journey in the direction of digital transformation and regulatory excellence, the achievements of its tax and customs administration stand as a testomony to the facility of innovation, collaboration, and strategic imaginative and prescient in driving constructive change. With €375 million in tax arrears collected in 2023 alone, Malta is poised to chart a course in the direction of enhanced compliance, financial resilience, and sustainable progress within the years to come back.