Online filing by individual taxpayers set to increase next year

Finance Minister Edward Scicluna is expecting a boost in the rate of online filing by individual taxpayers after government improves its online filing software next year.

Scicluna was speaking during a visit to the Inland Revenue Department (IRD), where he met with department senior officials and staff.

During a brief address, Scicluna emphasised the importance of adopting a firm but fair stance with respect to the collection of tax.

The Inland Revenue Department is responsible for the administration of the Income Tax and Capital Transfer Duty Acts and the enforcement of social security contributions under the direction of the Ministry of Finance.

In 2012, the department was responsible for the generation of €1.36 billion, made up of €866 million in Income Tax (Net of refunds), €407 million in Social Security Contributions (excluding state contributions), and €84 million in Capital Transfer Duty.

"This government's goal is to give this department the importance it deserves. I envisage a revenue collection system that interacts with taxpayers in a fair but yet firm manner," Scicluna said.

Scicluna underlined the importance that government entities responsible for collecting revenue be respected, while also operate in a manner that is transparent and accessible to the taxpayer.

"Government represents a multitude of services that taxpayers expect as a return on paying tax: education, health, pensions, infrastructure, capital investment, wages for civil servants like teachers, doctors, and policemen. The government cannot sustain these services without revenue. That is why the Inland Revenue Department, among other departments, is so essential."

Scicluna also referred to the ongoing merger process which will see the Inland Revenue Department, VAT Department, and Customs Department, join together into one revenue entity.

"We have ambitious plans as the merger is not easy and there is work to be done. But with effort, we will get there," he said.

Scicluna also welcomed the manner in which the IRD was able to bring the rate of company tax returns filed online up to 92%, as well as how the rate of individual tax payers which are not required to file tax returns was brought up to 72%.

"The next step is to gradually increase the number of individual tax payers, like self-employed, that file their tax returns online. This will require careful planning and modernisation of filing mechanisms," Scicluna said.

Scicluna also expressed his satisfaction at the fact that following the change in government, the Finance Ministry as it is today is in a position to be able to focus solely on the nation's finances.

"This will mean that many of the distractions which the Ministry was once hampered will no longer detract from its focus, and I will be able to focus on strengthening revenue generation, while containing public expenditure to stay within our financial means," Scicluna said.