Fighting tax evasion

The information released by Finance Minister John Dalli regarding tax evasion is quite alarming. Over 30,000 people, equivalent to almost one quarter of the country's taxpayers, failed to declare all their income in their tax assessment forms in 1999. This is nothing short of scandalous. These people now have until the end of the month to submit a correct version of their tax return, failing which they will charged a penalty of between three and six per cent interest.

There are other examples which are even more alarming. Mr Dalli said that 22,163 people failed to declare profits or interest they received from investments, amounting to Lm4,488,293. Furthermore, a total of Lm27,538,381 in turnover from sales and services was not declared and Lm6,253,388 was not declared by employees. One particular offender failed to declare a trade income of Lm1 million.

We welcome the income tax department's increased vigilance in identifying tax evaders and hope that when the tax compliance unit is set up later this year, the fight against such evasion will be further increased. One also hopes that this unit will be well staffed with professionals who are given the tools and the resources to really combat tax evasion, which is depriving the country of much needed revenue. The importance of winning the battle against the budget deficit cannot be over-emphasised. It is imperative, therefore, that the tax compliance unit is not just an exercise in public relations but a well-funded, adequately staffed organisation that is allowed to get on with its job.

It is equally important, however, that the tax compliance unit gets its priorities right. It is useless to pick on the small income earner or those in the middle income groups who are already taxed very highly and usually pay all their taxes right down to the last cent. The main role of the unit should be to identify "the big fish" who have been cheating the system for years, and continue to do so.

Failure to this will simply result in a waste of time, in hurting people at a time when the economy still has to take off and in turning public opinion against the unit.

Many big tax evaders are there for everybody to see. These include people who declare a moderate income yet own a huge villa, a yacht and a number of expensive cars. How is this possible? These people cannot be allowed to carry on evading taxes while the public at large is asked to make more and more sacrifices in order to put the country's finances in order. Let us hope that the tax compliance unit is allowed to do its job.

Return to your senses

The industrial action ordered by the General Workers Union in retaliation against the government's budget measures, and which have been in force since April, have achieved nothing except inconveniencing the public. The fact that the GWU has not yet called off its industrial action over the last budget and the government has announced that it will soon start discussing next year's budget is actually quite absurd. How can the country discuss the next budget if there is still no agreement over the previous budget?

The GWU has not managed to convince public opinion over its strike action and the government has found a way of getting around the union's directives which are aimed at a number of State owned companies and corporations. What is the net result of these limited strikes? The government has not been affected and has, to its credit, shown to be holding firm over its budget measures, as it should do. Although we disagree with a number of measures introduced in the last budget, we acknowledge that the government has every right to introduce them and that the GWU has absolutely no industrial dispute with the government, which makes the union's strike action illegitimate.

The GWU must return to its senses and realise that it is not getting anyway in this dispute. Furthermore, the Finance Minister has gone on record by saying that the reduction of the budget deficit has progressed better than expected so far, which must be due in no small way to the measures introduced in the last budget. The GWU must take note of this. It must also realise once and for all that its actions over the past two months have got it nowhere. It must now call off its industrial action, and, for the good of the nation, open a dialogue with the government regarding next year's budget.