The liability of the representatives under Maltese VAT legislation : a comparative analysis

Abstract

Under the Maltese Value Added Tax (VAT) Act, the term 'representative' has a two-fold meaning. It primarily designates the commonly accepted European-wide definition of a person who is resident in Malta and is appointed to act and perform all the taxable person's obligations in a representative status. It is also used to refer to those persons who, by the very nature of their office or status at law are considered to be representatives of the taxable person. Consequently, in the eyes of the law they are in the same position as the taxable persons actually registered with the VAT Department for the fulfilment of the obligations under the Act and can therefore be sought by it in regard of all the obligations of the taxable person. This latter connotation of the definition, which seems to be particular to Malta, shall be the focus of this thesis. Although the title reflects the liability of all the representatives under Maltese VAT legislation, there is yet another limitation to be mentioned regarding the subject dealt with infra. The VAT Act mentions twelve different individuals that are to be considered representatives of the taxable persons. While an analysis of all these individuals shall be made separately, the focus of this thesis shall fall on four particular individuals: those that are named to be representatives of bodies corporate. The controversial issues that shall be discussed have arisen from the way these persons are treated under the Act. Furthermore, the judgments of the Maltese Courts which deal with representatives, deal specifically with the treatment of the officers of bodies corporate. The practice of the Courts as well as the practice of the VAT Department in the same regard shall be outlined and analysed. The title of the thesis also promises a comparative analysis. It is worth pointing out that there shall be two analyses of different types. First, the relevant provisions of the VAT Act shall be compared to other provisions found within the Maltese regime of laws and regulations. In particular, attention shall be drawn to the likely source of laws such as the one under scrutiny. Secondly, the relevant principles of Maltese VAT legislation in this regard shall be compared to similar fiscal laws in other countries and the practices in place beyond our shores. This shall consist of an analysis of both law and procedure in countries where VAT is charged to taxable persons as well as in countries which apply other similar fiscal rules. All the above elements shall enable an exhaustive examination of article 66 of the VAT Act. Each chapter shall aim at inspiring a constructive criticism of the particular aspect of the subject that would be under treatment. This will inevitably lead to the drawing of conclusions that are worth some consideration.