No tax is deducted from the fee the Malta Football Association pays referees who control matches organised by the association, a practice that has been going on for 25 years.

The officials are not registered as working part-time with the MFA, which does not provide them with a statement of earnings at the end of the year. Neither are they registered with the VAT Department for tax purposes.

The Finance Ministry said there is no agreement with any sports association for any tax exemptions.

But referees have not been taxed since 1985 when the Inland Revenue Department had accepted a request made by the Malta Football Referees Association (MFRA). Tonio Briguglio, a former referee and MFRA president at the time, confirmed to The Malta Independent on Sunday that it had then been agreed that the money earned by referees for their services to the game should not be taxed.

“The circumstances were different from what they are today. At the time, we used to spend more money than we used to earn and we were paid a pittance,” he said. “Today, the rates are much higher, although I believe that they are still low, especially in the lower divisions and youth categories.”

This agreement has remained in place even though, over the years, the earnings of referees has multiplied and a 15 per cent withholding tax system has been put in place for income from secondary jobs to be taxed.

Contacted by this newspaper, the current MFRA president, Lorry Sammut, had no official comment to make except to refer us to the MFA directly. Questions sent to the MFA’s communications officer Mark Muscat on Tuesday remain unanswered.

All sports associations, and this includes the MFA, are obliged to deduct 15 per cent withholding tax from any payments they make to part-time employees, the Finance Ministry said in reply to questions put by this newspaper. They are also obliged to provide them with FS3s but if the 15 per cent tax is considered by the employee as final, he or she should not attach it to the tax return.

Another option would be for them to register with the VAT Department, in which case invoices have to be presented for payment purposes.

But referees – and other categories of people who render services to the MFA such as match inspectors and liaison officers – receive the gross amount for their services, with no tax deducted or paid. Match inspectors analyse the performance of referees and their assistants during matches, while liaison officers accompany foreign delegations when international games are held in Malta.

There are about 60 active referees, divided into different categories according to their experience. Only 12 of them control premier league matches, for which they are paid €100 for each game. Another €50 is paid to each of the two assistant referees and €30 to the fourth official. Taking only the premier league, where 132 matches are played each football season, the money the MFA pays the officials amounts to €30,360, on which €4,554 is supposed to be paid in tax at 15 per cent.

The top referees also get what is known as a training allowance, or €175 per month for 11 months a year, for a total of €1,925 each. No tax is deducted in this case either.

The rates for matches in the lower divisions and the youth categories are less.

The payment rates were established in an agreement the MFA has with the MFRA, an agreement that will expire at the end of the coming season.

Until 2008, the MFA used to pay the MFRA directly and, in turn, the referees association used to pay the officials according to the number of matches they controlled.

But, when the MFA applied to become a member of the UEFA Referees Convention, the regulations imposed that the football association must deal directly with the officials, and not through the MFRA. Since then, the payments have been made by the MFA to the referees individually.

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