Author: SME Chamber

The European Ombudsman, P. Nikiforos Diamandouros, received a positive reply from the EU institutions in 78% of cases where he issued critical remarks and made suggestions for improvement in 2010. He remained concerned, however, about the high number of unsatisfactory follow-up replies (10 out of 33) which the European Commission provided in response to his critical remarks. In total, he issued 38 critical remarks to the EU institutions, including the Commission, the European Parliament, and other EU agencies and bodies. On the other hand, the Ombudsman also identified seven "star cases" in which the follow-up to his remarks was exemplary. These are among the results of a new study on the follow-up given by the EU administration to the Ombudsman's critical and further remarks for the year 2010.

In 2010, the Ombudsman's critical and further remarks concerned matters such as unjustified refusal to give access to documents, problems with tender procedures, and infringement of the right to be heard. A further remark differs from a critical remark in that it is not based on a finding of maladministration. In 2010, the Ombudsman issued a total of 21 further remarks (20 of which led to positive replies). Both types of remark aim to help the EU administration to improve its services.

Constructive responses to cases concerning calls for tenders

In his previous follow-up report, the Ombudsman had criticised the institutions' defensive approach when it came to cases concerning calls for tenders regarding EU programmes and projects. This year's report, on the other hand, contains highly constructive responses to such cases.

One of the "star cases" concerned a complaint from a Belgian company, which lost a Commission tender in the field of European aid for Bulgaria and Romania. Following a critical remark, the Commission reconsidered its initial position and implemented the Ombudsman's proposal to launch a new tender procedure.

In his study, the Ombudsman also stressed that he would monitor the way the Commission deals with sub-contractors to ensure that their fundamental right to good administration is respected.

Commission's failure to give access to documents on car emissions

One of the unsatisfactory replies concerned the Commission's refusal to give full access to briefings prepared for a Commissioner in the framework of a proposal to reduce CO₂ emissions from passenger cars. Another involved the European Parliament's failure to follow-up constructively in a case concerning the double dependent child allowance for an official's severely disabled child.

The full follow-up report is available at: http://www.ombudsman.europa.eu/en/cases/followups.faces

The European Commission is asking the National co-ordinators for the SME Week to nominate an entrepreneur who will be included in the SME Week 2012 edition of the brochure "The Secret of Success". The Commission will use the brochure to highlight both the challenges and the excitement of entrepreneurship as a career choice and thus encourage the general public to consider being self-employed as a real and attractive career option.

 

For the 2012 edition the theme will be "European SMEs as International Champions". The Commission is working to establish a more coherent and effective EU strategy for supporting SMEs in international markets. Currently only 25% of EU SMEs are internationally active outside their home country through trade, investment or other forms of cooperation with foreign partners and only 13% venture in one of the mentioned forms outside the EU Single Market.

To demonstrate that size is not an obstacle, the SMEs can successfully compete internationally and thus to promote international activities of SMEs, the 2012 brochure will highlight entrepreneurs who are successful in exporting their products and/or services. The achievements of these EU international champions shall provide valuable lessons and inspiration for other SMEs. Furthermore, telling fascinating stories of how they have made their business successful should serve as stimulation and role model for other European citizens aspiring to become entrepreneurs.

We therefore ask you to contact Abigail Psaila at the GRTU in order to apply if you feel you fit in the criteria proposed by the Commission.

Malta's 2012 Budget, recently announced by the Minister of Finance, launched a temporary VAT amnesty providing for a remission of interest and administrative penalties for registered persons who have an outstanding balance under the 1994 VAT Act, Customs and Excise Tax Act or the 1998 VAT Act. The arrangement is open to Malta VAT registered persons who have failed to submit the necessary VAT returns (or VAT declarations) falling due up to the 15 October 2011 and/or have balances due to the VAT Department under any of the abovementioned Acts as at 15 October 2011.

Requirements for Eligibility

A person registered under article 10 of the VAT Act would be eligible for the scheme where he:

1. Has arrears due on returns for periods whose returns were due on or prior to 15 October 2011;

2. Has submitted all VAT returns which were due on or prior to 15 October 2011 by not later than 15 January 2012;

3. Submits on time and with full payment (if any) all VAT returns falling due on and after 15 November 2011 (an unofficial extension of one month has been granted with respect to VAT returns that were due to be filed by the 15 November 2011);

4.  Withdraws all appeals lodged before the VAT Appeals Board, the Administrative Law Tribunal or the Court of Appeal by 15 January 2012;

5. Submits payments by the dates indicated in the amnesty agreement (refer to Table 1):

The percentage by which the interest and administrative penalties will be decreased is determined by the option taken by the VAT registered person either to pay all the VAT and reduced interest and penalties by 15 March 2012 or pay the amounts due over a period of time between March 2012 and February 2013 as per Table 1 below.

 

 

 

Where the balance due to the VAT Department is equal to or greater than the total interest and administrative penalties due, the percentage reduction is calculated on the interest and administrative penalties only. However, where the balance due is less than the total interest and administrative penalties due, the percentage reduction is calculated on the balance due.

Numerical Example 1

Total outstanding balance due is €15,000

Total interest and administrative penalties accrued is €10,000

In this case the total outstanding balance is more than the total interest and administrative penalties accrued and the remission will affect the €10,000 interest and administrative penalties as follows: Table 2

 

 

 

 

 

 

Numerical Example 2

Total outstanding balance due is €5,000

Total interest and administrative penalties accrued is €10,000

 

 

In this case the total outstanding balance is less than the total interest and administrative penalties accrued and the remission will affect the €5,000 balance due as follows:

Table 3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

A person registered under article 11 or 12 of the VAT Act would be eligible for the scheme where he:

1. Submits all pending declarations/notices by 15 January 2012;

2. Pays €10 in respect of each default by 15 January 2012

Importantly, in all the above cases: The remission shall only have effect in the account of the registered person once final payment in accordance with the amnesty agreement is effected to the satisfaction of the VAT Department;

Where the registered person complies with the relevant conditions of the amnesty all interest that may accrue during the repayment period will be remitted;

The amnesty does not entitle a registered person to make a claim for a refund in respect of interest and penalties already paid;

If interest is remitted under the scheme, the VAT Department reserves the right to deduct the interest so remitted from any interest payable to that person on VAT refunds due to him in the next six years that are not paid by the due date.

Info from Deloitte

Why did you become an entrepreneur? I had so many new ideas that the only way I could bring them to life was by setting up my own business.

How have you come to chose your line of business?Since childhood I wanted to somehow work in mass communications. I always felt I had a "special gift" for creativity and this line of work.

Where did you go on your last holiday?

Apart from work related travel, the last real holiday with my family was to Dubai

What is your earliest memory?

Crying my eyes out to avoid going on the bus to school with the sister that I was terrorized of (she was probably a very nice person).

If you could chose to be someone famous who would you be?

There are many famous people I admire but none that I would want to be as such.

Following Government's decision to carry out works under a Ten T Project in Triq Dicembru 13 to Menqa Roundabout Marsa, GRTU had discussed with Transport Malta the phasing and traffic management and had made a number of requests for improvement such as the initiation of works after the festive season, therefore later than originally planned.

 

 

 

 

 

GRTU is now pleased to inform that we received communication from Transport Malta that following in depth consideration of GRTU's concerns the programme of works were revised accordingly.

The works will be concentrated in Spencer Garden area and along the Triq Salib Tal-Marsa between Triq is-Sajjieda and Bridgestone within the pavement and parking area only. The works in Triq is-Salib tal-Marsa and Triq Patri Felicjan Billocca from area infront of church, junction with Triq Balbi and up to Triq is-Sajjieda will commence on 2^nd January 2012. As from this date access will only be limited for vehicles to render a service and some parking will be lost.

Transport Malta assured the GRTU that it will be doing its utmost to minimise the inconvenience but due to the nature of works (deep trenches) and for safety reasons access will be denied during certain times when they will be proceeding with works.

Transport Malta thanked the GRTU for the strong cooperation we always show and stated that they are always available for any clarification requested.

 

Mario Cutajar is GRTU's new representative on the Consumer Affairs Council. Mr. Cutajar of Ultimate is a former president of GRTU who for many years has been active on consumer affairs on Directives concerning consumers.

 

 

 

GRTU was previously represented on this Council by Mr. Anthony Camilleri of Camilleri Paris Mode, another former GRTU President. Mr. Camilleri's role on the Consumer Affairs Council has been determinant on various actions of the Consumer Affairs Authority effecting retailers. GRTU takes this opportunity to thank Mr Camilleri for all his endeavours in promoting the interest of retailers and push for a mutually appreciative relationship between retailers and consumers.

GRTU has also appointed Ms Carmen Borg to sit on the National Quality Award Committee. Ms Borg is a GRTU official who has long years of experience working at the GRTU and who has dealt with vast varieties of businesses and issues.

GRTU augurs Mr Cutajar and Ms. Borg on their new appointment.

Estensjoni ghall-Applikazzjonijiet biex jinhafru l-multi ta' dawk li jixtiequ jirregolarizzaw ruhom mad-dipartiment tal-VAT, skema kif imhabbra fl-ahhar "Budget" – Il-Ministru tal-Finanzi, l-Ekonomija u l-Investiment l-Onorevoli Tonio Fenech, illum laqa' it-talba tal-GRTU biex id-data tal-gheluq ghal sottomissjonijiet tar-"returns" tal-VAT ta' dawk li waqghu lura biex ikuu jistghu jibbenefikaw mill-iskema tat-tnaqqis fil-multi kif imhabbar fid-diskors tal-Budget, tkun estiza sa l-ahhar tas-sena.

 

Il-GRTU,bhala l-organizzazjoni ewlenija f'Malta li taf sew kif ihabbat il-polz tan-negozjant, insistiet ma' dawk milquta sabiex iwasslu l-applikazzjonijiet taghhom mad-data tal-gheluq imhabbra fid-diskors tal-Budget ta' din is-sena. Gara pero li hafna accountants ma irnexxilhomx jaghmlu dan minhabba il-hafna impenji li fl-ahhar xahar tas-sena s-soltu ikollhom sabiex ilahhqu jwasslu l-applikazzjonijiet kollha skond id-data tal-gheluq. Din l-estensjoni ser taghmilha possibbli biex hafna iktar negozji jottemporaw ruhom u jirregolarizzaw ruhom mad-dipartiment tal-VAT minghajr "stress" zejjed fi zmien tas-sena tant important u impenjattiv ghal hafna negozji zaghar. Il-GRTU tirringrazzja lill-Ministru tal-Finanzi, l-Ekonomija u l-Investiment l-Onorevoli Tonio Fenech, kif ukoll is-Segretarju Permanenti fil-Ministeru tal-Finanzi, talli taw widen ghat-talba tal-GRTU u ghal-ko-operazzjoni shiha taghhom mal-GRTU.

The comment published in the Sunday English newspaper Maltatoday on the 11th instant in Saviour Balzan's column went beyond any limit acceptable under Maltese law and constituted defamation against the person of Vince Farrugia.

 

In the Court case instituted by the Executive Police on behalf of the Attorney General against Sandro Chetchuti in connection with the attempted murder of the GRTU's Director General on the 11th March 2009 amongst other charges, the Court of Magistrates is in the process of compiling evidence and has already heard the testimony of the eye witnesses amongst others.

The prosecution is still in the process of presenting its evidence, consequently illusions of conspiracy theories or futile comparisons to other case law, published by certain parts of the media such as the aforesaid article published by Maltatoday, are not only defamatory to the injured party in the criminal case pending  before the Court of Magistrates, but may be prejudicial to the administration and delivery of justice.

The libel suit presented in Court this week will beheard later on next year.

"Value Added Tax (VAT) is paid for by citizens, collected by businesses and accounts for over 20% of national revenues. It therefore has a significant impact on every single EU citizen. However, it is now 40 years since the EU VAT system was first set up, and the regime no longer fits with our service-driven, technology-based economy. The time has come for an ambitious VAT reform." said Algirdas Šemeta, Commissioner for Taxation, Customs, Anti-fraud and Audit.

 

On this basis, the Commission This week adopted a Communication on the future of VAT. This sets out the fundamental characteristics that must underlie the new VAT regime, and priority actions needed to create a simpler, more efficient and more robust VAT system in the EU.

Three overriding objectives shape the vision for the new VAT system:

First, VAT must be made more workable for businesses. A simpler, more transparent VAT system would relieve businesses of considerable administrative burdens and encourage greater cross-border trade. This, in turn, will be good for growth. Among the measures envisaged for a more business-friendly VAT are expanding the one-stop-shop approach for cross border transactions; standardizing VAT declarations; and providing clear and easy access to the details of all national VAT regimes through a central web-portal.

Second, VAT must be made more efficient in supporting Member States' fiscal consolidation efforts and sustainable economic growth. Broadening tax bases and limiting the use of reduced rates could generate new revenue for Member States without the need for rate increases. The standard VAT rate could even be reduced in some Member States, without any impact on revenue, if exemptions and reductions were removed. The Communication sets out the principles that should guide the review of exemptions and reduced rates. The Commission will also be analysing Member States' use of reduced rates and exemptions when reviewing their fiscal policies in the context of the European Semester (see MEMO/11/11).

Third, the huge revenue losses that occur today due to uncollected VAT and  fraud need to be stopped. It is estimated that around 12% of the total VAT which should be collected, is not (so-called VAT Gap). In 2012 the Commission will propose a quick reaction mechanism to ensure Member States can respond better to suspected fraud schemes. Furthermore, the Commission will see whether current anti-fraud mechanisms, such as Eurofisc, need to be strengthened and will explore the possibility of a cross-border audit team to facilitate multilateral controls.

Finally, the Commission has concluded that the long-standing question of changing to a VAT system based on taxation at origin is no longer relevant. Therefore, VAT will continue to be collected in the country of destination (i.e. where the customer is located), and the Commission will work on creating a modern EU VAT system based on this principle.

Background

On 1st December 2010, the Commission adopted a Green Paper on "The future of VAT – Towards a simpler, more robust and efficient VAT system". This Green Paper was followed by a six month public consultation in which the Commission received 1700 contributions from businesses, academics, citizens and tax authorities.

The European Parliament, the European Economic and Social Committee and the Tax Policy Group consisting of the personal representatives of the finance ministers welcomed the Green Paper and confirmed the need to reform the EU VAT system.

In parallel, the Commission carried out an economic evaluation of the VAT system.

For the full text of the Communication and more details on VAT, see:
http://ec.europa.eu/taxation_customs/taxation/vat/key_documents/communications/index_en.htm
Homepage of Commissioner Algirdas Šemeta, EU Taxation and Customs Union, Audit and Anti-fraud Commissioner:
http://ec.europa.eu/commission_2010-2014/semeta/index_en.htm
MEMO/11/874