The Inland Revenue Department dished out more tax refunds in the first three months of 2008, coinciding with the general election campaign, than in the whole previous year, figures released in parliament show.
While €5.7 million were refunded to taxpayers in 2007, in the three months preceeding the election a total of €8.2 million were refunded by the tax deparment.
In 2007, 692 persons and 18,666 individuals benefitted from tax refunds. In the first three months of 2008, 647 companies and 14,776 indivuals were given refunds.
Effectively in the three months of 2008, the number of persons and companies benefitting from a refund represented 80% of the total number of beneficiaries in 2007.
A spokesperson for the Ministry for Finance attributed the massive increase in refunds to a “payment schedule” issued in August 2007.
According to the payment schedule, 22,000 individuals and companies were to receive €40 million in refunds due for tax assessments preceeding 1998.
Significantly, 15,423 received their due refunds in the first three months of the 2008 right in the midst of the electoral campaign.
The spokesperson explained that the urgency of paying out these refunds was due to the fact that government could end up paying interest if the refunds are not paid by December 2009. “According to this payment schedule we committed ourselves to issue refunds till December 2009. Otherwise the government will incur interests. This is why more refunds were issued during 2008,” the spokesperson added.
So far a total of €14 million have been refunded.

jdebono@mediatoday.com.mt