The government’s efforts to clamp down on tax evasion has led to a decision to implement measures to see that families hosting foreign students, in Malta to learn English, pay their full dues.

For many years there was the wrong impression that income from such an exercise was tax-free. The government has now made it clear that it is not.

Although no official figures are available, there are many host families who are not paying their fair share of taxes, mainly due to the widespread misconception that hosting families is a tax-free service.

Host families are intelligent enough to know how to do their homework. Most of them are not hosting these students to do the country a favour or out of ‘love’ for their guests. They are doing it to make money and, in some cases, a lot of money too. If one family had to host four students – the maximum number of students per household – for a year, the family would be making a gross figure around Lm7,300. Naturally, from this one has to deduct the expenses of providing food and drink as well as other services like water and electricity.

It is true that host families are like frontline ambassadors for Malta, given that the students who are well looked after, leave the island with very good impressions of Malta and the Maltese. But one cannot simply evade tax just because of the importance of students on the tourism industry.

As parliamentary secretary Tonio Fenech told this newspaper in a recent interview on the host family taxation issue, the government cannot let host families not pay their taxes just because it is important to the local economy. Income is income from whatever source it is coming and is therefore taxable.

The setting up of the Tax Compliance Unit was a step in the right direction to ensure that all members of the community pay their fair share of tax.

While it is agreed that the government does its best to get what it is owed in taxes, several families believe that the matter should have perhaps been tackled differently.

What the host families did not like, for example, is that the government initially insisted that income tax owed up to eight years back should be taken into account. After long sessions of consultation, especially through the Chamber of Small and Medium Enterprises, this has been brought down to three years.

Yet, on the other hand, it must also be said that there are many families who over many years have made a lot of money from this “industry” – if not, they would have called it a day ages ago – and never paid tax.

How can host families think that their income is non-taxable? Where did this misconception come from? Some are saying it was the language schools which told them this in order to manage to recruit more host families. But this is not the point. The point is that host families’ income must be taxed like any other form of income.

Language schools are predicting a 20 per cent decrease in the supply of host families this year. This is largely because many are saying that, if they are to pay tax on their income, it is no longer viable for them to host students. Still, it must be admitted that the conditions to be employed – such as no tax on the first Lm1,000 earned – are quite generous.

But it’s not only host families that have to be chased to declare all their income. Professional people and other self-employed persons also need to pay their full dues to the country. The government would therefore do well to assess this situation too. It cannot just deal with host families because, perhaps, it is easier to do so.

The government needs to look at other sectors and ensure that everyone pays their share of tax. It’s only fair after all.