The exercise is to start in the next few days after the ADT wrote to K and Y plate owners, warning them about this matter and calling on them to regularise their position if the car bearing these plates is not being used legitimately.
Speaking to The Malta Independent, ADT chief executive officer Mario Falzon said that the authority will be taking a firm stand on this abuse.
He explained that cars with engines below 1,300cc are liable for registration tax equivalent to 50.5 per cent of the cost, insurance and freight of the car.
Cars with engines between 1,301cc and 1,500cc attract 53 per cent; those between 1,501cc and 1,800cc attract 60 per cent; between 1,801cc and 2,000cc 65 per cent, while cars with engines more than 2,001cc pay 75 per cent.
Value Added Tax of 18 per cent on the original price of the car also has to be paid.
K and Y number-plates are being used illegally because, regardless of engine size, only 30 per cent of cost, insurance and freight has to be paid. Mr Falzon said most of the cars wrongly carrying K and Y plates are those with engines above 1,800cc. Such cars include makes such as Mercedes, Mitsubishi Pajeros, BMWs, Toyota Landcruisers and other high-class vehicles.
After three years, cars with K plates may be changed to normal registration plates, while after five years, cars with Y plates can have their registration plates changed.
In its letter to owners of self-drive (K plates) and chauffeur-driven (Y plates) vehicles, the ADT pointed out that self-drive cars can only be rented out for a period of not more than 90 days. Cars with Y plates cannot be leased and can only be driven by those holding a permit to drive chauffeur-driven cars.
The ADT gave these owners a month to regularise their position, but only a few of them had approached the authority to effect a change in ownership of the car.
Mr Falzon said the authority is initiating a process to investigate people who are illegally using K and Y number-plates. If found guilty by the court, these people will be liable for a fine of not more than Lm500 or twice the amount of tax which has been evaded and which therefore still has to be paid. Moreover, the court may order imprisonment of up to six months.
He said that the ADT will be involving the VAT Department and the Tax Compliance Unit in this operation, since it is an issue of tax evasion, and possibly the police.
Asked how the owners of these cars had been allowed to have K and Y plates, Mr Falzon said that at the time, there was not much control over what was being done. However, he insisted that now was the right time to take action regarding this abuse.
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