Inland Revenue Department Essay

The Inland Revenue Department (or IRD in short), is responsible for the government’s tax revenue in Malta. It is the IRD’s duty to keep records of and administer daily the Income Tax and the Capital Transfer Duty and enforce the Social Security Contributions, by order of the Ministry of Finance.

Analysing a time-series data of the Maltese government’s tax revenue throughout the years, mostly in the past 25 years, we could obtain some important information regarding any changes and trends in the tax burden in our economy. Several studies and reports have been conducted in the past, but a look at the NSO’s statistics is the most suitable way to analyse such changes.

Starting off from 1990, we can obtain information abouttaxation in Malta according

According to news releases and official information found on the National Statistics Office (NSO) website, in 1990 the total tax revenue collected throughout the year made up 59.8 per cent of Government’s total revenue.

This figure continued to increase slowly year after year, and by 2002 this percentage of tax revenue had increased to 78.4 per cent. Another important piece of information noticed is that the composition of the Maltese tax burden between 1990 and 2002 relied heavily on indirect taxes.

As shown in Figure 2, during these 13 years mentioned (1990-2002), indirect taxes made up between 39.4 per cent (in 1993) to 46 per cent (in 1995) of total tax revenue. These are considerably large figures, and in each year throughout this 13-year period, indirect taxes combined the biggest percentage of tax revenue for the government.

For example in 2001, indirect taxes made up 43.9 per cent of the total tax revenue, whereas the EU average of indirect taxes amounted to 33.7 per cent. During the same year, direct taxes amounted to 32.7 percent and social contributions to 22.4 per cent. Conversely, for the same year The European Union’s average of social security contributions collected was made up of a 31.4 per cent share in the EU