P.A.Y.E. and P.T. systems in Malta : an analysis

Abstract

Everyone will agree that nowadays taxation is a matter of prime importance. It has profound economic, social and political effects on our lives as individual citizens and as a nation. It is because of this unquestionable importance that taxation policy and its repercussions are closely followed by the public in general. To attempt to answer such questions, which immediately come to mind when taxation is discussed, as to whether tax should be levied at all or what is the true purpose of taxation, would lead us into the realm of political and economic philosophy, fields which are far beyond the scope of this analysis. We must accept the fact that income tax has been assessed and charged in Malta on the taxpayers since its introduction in 1948 and is still being charged; although it goes without saying that the Maltese taxpayer, as his counterpart throughout the world is particularly adverse to any form of taxation in particular to that levied on income. This type of direct taxation which takes into consideration the difference in the amount of income the different taxpayers receive or earn can be said to be socially more just than taxes which are levied indirectly on consumer goods etc. and which must be paid irrespective of the income of the buyer or such like considerations.