Despite claims by successive governments that taxes were being reduced, total tax revenue last year went up by €175.1 million over the previous year, to €2,484.4 million, the National Statistics Office reported last week.

During 2013, the tax burden for Malta was 33.1 per cent compared to 32.2 per cent recorded in 2012

Tax revenue may be broadly classified under three main headings: indirect taxes,

direct taxes and social contributions.

All three categories of tax revenue registered an increase. The largest rise, €105.0 million,

was recorded in direct taxes, defined as current taxes on income and wealth plus capital

taxes and other current taxes.

 In the year under review, these taxes amounted to €1,056.0 million, or 2.5 per cent of total tax revenues. The rise in direct taxes was mainly the result of additional revenues from corporate and personal income tax of €55.6 million and €50.5 million respectively.

Conversely, capital taxes registered a decline of €3.4 million.

Indirect taxes are taxes linked to production and imports. During 2013, these went up by €47.0 million to €990.9 million, making up 39.9 per cent of total tax revenue. Higher returns from VAT of €50.0 million were partially offset by lower proceeds from import duties of €4.0 million. The other taxes in this category increased marginally.

Social contributions are compulsory actual payments by the employees, employers, as well as self-employed and non-employed persons. This category represents 17.6 per cent

of total tax revenue, or €437.5 million, up by €23.1 million rise over 2012.

The overall tax burden denotes the total amount of taxes and actual social contributions

expressed as a percentage of GDP.